Organising Finance for Your New Car

So, you’re about to buy a new car. Buying a car is one of the biggest financial decisions that many people make, second only to buying a home and taking out a mortgage. But this doesn’t mean that organising the financing needs to be difficult. Even though the budgets of many families are constrained these days, there are also a number of good financing options to look at when it comes to buying a new car.

How Should You Buy the Car?

The truth is that most people don’t have the spare cash to cover purchasing a new car. This means that financing needs to be sought from a lender, or a bank in many cases. There are a number of ways that you can organise the financing for a new car.

  1. Take Out a Personal Loan

If you want to apply for your own personal car loan from the bank rather than use the financing options from the car dealership, you’ll need to approach a credit union, major bank, or building society. If you already have a mortgage or savings with one bank, you may find it easier to also organise a personal loan with them to cover all or part of the car purchase.

You will want to take note of interest rates and repayment terms. Some lenders offer a fixed rate for so many years before a variable rates kicks in. The main criteria for this type of loan is usually your capacity to make payments on the loan each month.

  1. Finance Options through the Car Dealership

Many car buyers prefer this option because it’s easy and convenient. The thing you have to remember is that the car dealers in Canberra only tend to work with a few lenders and car loans generally attract higher interest rates. The higher interest rates are passed on to cover the small commission that the dealership receives for selling the branded finance.

  1. Using Your Credit Card

If approaching a big bank for a loan doesn’t appeal to you, you can always use your credit card. This can be especially helpful if you have most of the cash available for the car but just need an extra few thousand to get the deal done.

Having said that, you must also bear in mind that credit card transactions attract fees in terms of a percentage. This means that you may end up paying more than you had bargained for. You will also need to pay back the money, and this may also attract a high interest rate from the credit card company.


There are many financing options for buying the car you want. Just bear in mind the interest rates and repayment terms. This is a long-term decision that should be factored into your household budget.

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