Using a Secured Car Loan to buy your car
A Secured Loan is a type of Car Loan that involves the lender having a security against the money you've borrowed from them, in this case the car itself. This means that if you're unable to make your loan repayments, the lender has the ability to repossess your car and sell if off to pay off the amount still owed.
A Secured Loan has some major benefits over unsecured loans (such as a Personal Loan). As lenders have your vehicle as security, they're more likely to offer better loan terms including longer repayment periods, higher borrowing limits and lower interest rates. This can lead to you paying back less in the long term.
How does a Secured Car Loan work?
A Secured Loan is common type of car loan that's available for Personal Use and Business Use. It functions similarly to a home loan works, where the asset is used as collateral for the lender.
To meet criteria of a secured loan, the vehicle you're purchasing needs to fit into certain requirements such as car type and age. Usually lenders will offer a secured loan for cars that are less than 5 years old.
The alternative option is an unsecured loan, such as a Personal Loan, which are commonly used to finance older assets, or those where the lender is not seeking security. An unsecured loan often has a higher interest rate payable.
Features of a Secured Car Loan
- Car loans from $5,000 to $150,000.
- Borrow at a lower interest rate that an unsecured loan.
- Fixed interest rate so you know what your repayments will be.
- Weekly, fortnightly or monthly repayments.
- Flexible loan terms ranging from 1 to 7 years.
- Available for Personal Use and Business Use.
Why choose a secured car loan with Stratton Finance?
Versatile Loan OptionsWhether you’re purchasing a new or used car, we can help you find the right secured loan to suit your needs with our extensive range of options available for business and personal use.
Competitive RatesWith our large network of over 30 different lenders, we can compare different interest rates on your next car loan and set you up with flexible financing.
Dedicated ConsultantWhen you enquire about a car loan with Stratton, you’ll have a dedicated consultant who will walk you through the process from start to finish to ensure you’re getting the right loan.
Common questions about Secured Loans
What is a car loan?
A car loan (which can be referred to as a secured car loan if security is sought by the lender) involves a finance company lending you the money to purchase an asset and retaining security over it for the life of the loan. Car loans can be arranged for both personal use (such as a consumer car loan) or business (such as a chattel mortgage).
What are the benefits of a car loan?
By taking out a car loan to finance your next car you can reduce your overall cash outlay which you may want to use for other purposes (such as taking a holiday!). If you’re a business, a car loan may improve your cash flow, as well as potentially allowing you to claim a tax deduction for the car (check with your accountant for eligibility).
What tax and GST can I expect to pay on a secured loan?
There may be tax benefits if you are financing a car for business purposes. Please visit the ATO website, or speak to your accountant to understand potential tax deductions for your specific purposes. If you are considering a novated lease, you can use our novated lease calculator to get an estimate of the potential savings available.
Who should choose a secured car loan?
A secured car loan is a relevant option for an individual or business looking to access lower interest rates and has sufficient serviceability. For an employee of a business looking to salary package benefits of their employment, a novated lease may be more appropriate.
Looking for more information?
We've made it easy for you to find everything you need here.
EXCEPTIONAL, as good as Customer Service gets
Can't Recommend Highly Enough!!
Meet our partners
Get access to an unmatched panel of finance and insurance partners all in one place, instantly.
Let's get started
Obligation free and no impact to credit score