Car Loans Australia :: Articles

When to use a Finance Broker for Car Loan Finance 

When to use a Finance Broker for Car Loan Finance 

Whether you're buying a car for the first time or you've been through the process before, it's always worth considering whether or not you should use a finance broker to arrange your car loan. In this article, we'll weigh up the pros and cons of using a specialist finance broker so that you can make the best decision for your circumstances.

A Finance Broker, by definition, works for you, not the lender. They should have extensive knowledge of the different loan products on the market and can help you to find the most competitive interest rate.

When you work with a broker, you can expect the help and advice you need to find the right loan for your situation. They'll be able to explain everything about the loans they offer, including interest rates, repayment terms and how much you can expect to borrow.

Car Finance- Quick & Easy
If you are in the market for a new or used car, then we're in the market to help you arrange the money. Our car loan & leasing finance service is backed by a national panel of car loan specialists who will establish your eligibility, find lender/s offering the best deals for your situation - and help you through the approval and settlement process. No charge to you - and no obligation to proceed with any recommendations offered.

You don't need perfect credit or any credit at all — most brokers will consider your situation on an individual basis. This means that, if you have been turned down by other lenders or you've had issues making repayments in the past, then a broker may still be able to help you secure a deal.

As long as you are an Australian Resident, have been employed for at least three months and are over 18 years old, then there's no reason why a broker can't help.

Pros:

1. Access to a wider range of lenders:

By working with a finance broker, you'll have access to a wider range of potential lenders than you would if you were to apply for a loan on your own. This gives you a better chance of being approved for a loan the first time you apply.

It's important to remember that every loan enquiry that you make will be recorded on your credit file and could affect your credit rating ... whether you are approved or not.

If you make too many loan enquiries then it will become more difficult to obtain finance. A specialist Car Finance Broker will help protect your credit rating by applying only to lenders that are likely to approve your application, taking into account your specific circumstances.

2. Lower interest rates:

Because finance brokers have access to a wide range of lenders, they can often negotiate better interest rates on your behalf. This can save you money over the life of your loan.

Some of the lenders work exclusively through brokers and many others are accessible through brokers at wholesale or discount rates.

3. One-stop shopping:

Applying for a loan can be a time-consuming and complicated process.

By working with a finance broker, you can simplify the process and save yourself a lot of time and hassle.

4. Expert advice:

A finance broker can provide you with expert advice on the best loan options for your needs and situation. This can be extremely helpful if you're not sure where to start or what kind of loan structure would be best for you.

Cons:

1. Broker fees:

Some Finance Brokers will charge a fee for their services. This fee can range from a few hundred dollars to a few thousand dollars, depending on the size and complexity of your loan.

Whilst you may not be required to pay a fee upfront, out-of-pocket, it may be built into the loan - meaning that you will be borrowing the amount of the fee on top of the loan amount that you otherwise required.

If there are any broker fees payable, you should ensure that they reflect the interest rate savings, the advice, the convenience, lender access and the overall benefits that you would not have otherwise gained.

2. Time:

Working with a finance broker for the first time can take some time, as you'll need to provide them with information about your financial situation and goals.

If you're in a hurry to get a loan, working with a broker may therefore not be the best option for you. Whilst most brokers are well set-up for fast turnaround on loan approvals, in some cases, it may be quicker to phone your bank if you have a healthy relationship with them.

On the other hand, if you want the best deal, it would be well worth contacting a broker. Car loans can generally be approved and settled within a day or so.

3. Loan servicing:

Because they're not affiliated with any one lender, the Finance Broker may not be able to offer you the same detailed level of service or support that you would receive if you went directly to a bank or other financial institution.

So if you arrange your loan through a broker, you will still need to communicate with the lender directly on any administrative issues relating to your loan after it has been settled.

Conclusion

Whilst the benefits of using a finance broker to get a car loan far outweigh the downsides in the vast majority of cases, the decision on whether or not to use a finance broker to arrange your car loan is one that comes down to personal preference.

If you're comfortable doing your own research and you're confident you'll be able to find a good deal, then going it alone may be the best option for you.

However, if you feel like you need a bit of extra help to find the right loan, then using a broker may be the way to go.

Published: Thursday, 18th Aug 2022
Author: Paige Estritori


Car Loans Articles

Car Loans: Secured vs Unsecured Car Loans: Secured vs Unsecured
Car loans play a pivotal role in empowering individuals to afford their own vehicle, which can be a significant purchase. These loans, structured to fit within one's financial situation, can ease the burden of acquiring a car and assist in achieving personal convenience and mobility. - read more
Navigating Car Finance: How to Choose a Loan That Works for You Navigating Car Finance: How to Choose a Loan That Works for You
Buying a car is a significant financial decision, and for many, it means exploring the world of car finance. In Australia, the options are plentiful, and understanding them is key to making an informed choice. Car finance can seem daunting, with various loan types, interest rates, and repayment plans to consider. But fear not – a clear understanding of these options can steer you towards a deal that complements your financial circumstances. - read more
The Smart Aussie Buyer's Guide to Securing the Best Price on a New Car The Smart Aussie Buyer's Guide to Securing the Best Price on a New Car
There's a unique thrill that comes with purchasing a new car; it's not just about getting from point A to B, but about fulfilling a dream and the freedom of the open road. However, with the excitement comes the need for careful planning and smart decision-making to ensure that your investment pays off in the long term. - read more
Your Car Loan Journey: From Application to Approval Your Car Loan Journey: From Application to Approval
In this article, we are embarking on a guided journey that we believe will help immensely in navigating the intricacies of the car loan process. - read more
The Essential Guide to Securing Affordable Car Finance in Australia The Essential Guide to Securing Affordable Car Finance in Australia
Finding an affordable car finance option can make the dream of owning a vehicle a tangible reality for many Australians. It’s about understanding the intricacies of the loan market, interest rates, and finding a plan that aligns with your financial prospects and constraints. In a society built on the convenience of mobility, securing a car that meets both your needs and your budget is essential. - read more
Navigating Car Finance: How to Choose a Loan That Works for You Navigating Car Finance: How to Choose a Loan That Works for You
Buying a car is a significant financial decision, and for many, it means exploring the world of car finance. In Australia, the options are plentiful, and understanding them is key to making an informed choice. Car finance can seem daunting, with various loan types, interest rates, and repayment plans to consider. But fear not – a clear understanding of these options can steer you towards a deal that complements your financial circumstances. - read more
Top Tips for Australians Navigating the Online Car Market Top Tips for Australians Navigating the Online Car Market
The Australian automotive landscape has witnessed a significant transformation with the rise of online car sales. The concept of browsing, selecting, and purchasing a vehicle through digital platforms has gained immense popularity, offering consumers a vast array of choices at their fingertips. - read more
The Smart Aussie Buyer's Guide to Securing the Best Price on a New Car The Smart Aussie Buyer's Guide to Securing the Best Price on a New Car
There's a unique thrill that comes with purchasing a new car; it's not just about getting from point A to B, but about fulfilling a dream and the freedom of the open road. However, with the excitement comes the need for careful planning and smart decision-making to ensure that your investment pays off in the long term. - read more
Car Loans: Secured vs Unsecured Car Loans: Secured vs Unsecured
Car loans play a pivotal role in empowering individuals to afford their own vehicle, which can be a significant purchase. These loans, structured to fit within one's financial situation, can ease the burden of acquiring a car and assist in achieving personal convenience and mobility. - read more
Your Car Loan Journey: From Application to Approval Your Car Loan Journey: From Application to Approval
In this article, we are embarking on a guided journey that we believe will help immensely in navigating the intricacies of the car loan process. - read more

Finance News

Inflation Data Spurs Talks on Future Interest Rates Inflation Data Spurs Talks on Future Interest Rates
27 May 2024: Paige Estritori

As Australians wrestle with persistent cost-of-living challenges and elevated interest rates, there may be some optimism on the horizon with expected reductions in inflation rates. - read more
Impact of Budget on Borrowers: A Deep Dive Impact of Budget on Borrowers: A Deep Dive
20 May 2024: Paige Estritori

Concerns are mounting among financial experts that the latest federal budget could prompt a rise in interest rates, adding to the challenges faced by borrowers. - read more
Rookies in Real Estate: Albanese Budget Misses First-Time Buyers Rookies in Real Estate: Albanese Budget Misses First-Time Buyers
18 May 2024: Paige Estritori

The Albanese government's latest housing budget injects billions into housing, aiming to energize the construction of new homes. However, an important demographic has been left disappointed: first-time home buyers who feel sidelined amidst these changes. - read more
Australia’s Housing Dilemma: Construction Lags as Population Booms Australia’s Housing Dilemma: Construction Lags as Population Booms
17 May 2024: Paige Estritori

In a recent address delivered in Hobart, Reserve Bank of Australia (RBA) Assistant Governor Sarah Hunter highlighted a mounting concern in Australia's housing market: a significant shortage of homes amidst rapidly growing population numbers, largely driven by net overseas migration. - read more
Australia's New Pathway to Boost Economic Growth Australia's New Pathway to Boost Economic Growth
16 May 2024: Paige Estritori

Australian financial sector leaders have expressed strong support following the latest announcement of key budgetary adjustments aimed at streamlining investment processes and deepening engagement within the nation's financial landscape. The Federal Budget has placed a spotlight on the financial service sector's significant position as a promoter of Australia's sustainable economic prosperity. - read more

Need Help Finding a Loan?
Get a free car loan eligibility assessment and compare offers tailored specifically to your circumstances.
Loan Amount:
Postcode:
All finance quotes are provided free (via our secure server) and without obligation.
We respect your privacy.

Knowledgebase
Mortgagor:
A person who offers to assign an asset as security (e.g. real estate) under a mortgage loan contract. The lender (mortgagee) holds the legal ownership of the security until the loan is repaid and the mortgage is discharged.