Which car finance route could work for you?

Ready for your next set of wheels but unsure which finance route to take?

Whether you’re eyeing a new or pre-loved vehicle, understanding your finance options can help you take the keys with confidence.

Here are some common funding options to consider.

Car loans

Car loans are secured loans that help you buy a vehicle by spreading the upfront cost over time.

Since the car itself is used as collateral against the loan, they often come with more competitive rates. This could make a car loan a handy option if you’re seeking to pay less interest, take out a larger loan, or you have a complex credit history.

Some car loans also offer a balloon repayment option - a lump sum due at the end of the term – allowing for lower monthly repayments.

Personal loans

If you're after more flexibility, a personal loan could be a great option. These loans come in two main forms: secured and unsecured.

A secured personal loan is backed by an asset, like your car or property, which can help you access lower interest rates.

An unsecured personal loan does not require you to put an asset forward. While this offers more freedom, it can come with higher rates due to the added risk for lenders.

Along with buying a car, personal loans can also help you cover extras like accessories or upgrades.

Leveraging home equity

If you’re a homeowner with equity in your property, you may be able to borrow against it to help finance your next car.

Home equity loans use your property as security, which could mean lower interest rates and more manageable repayments when compared to traditional car loans.

Be sure to do your research and plan your repayments carefully. Since your home is used as collateral, missing repayments could put your property at risk.

Getting started

If you’re ready to get in the driver’s seat, chat with your local Liberty Adviser about your lending options.

As a lending expert, they can explain the solutions available in more detail and guide you through the lending process, step by step.