When people think about car loans, or applying for a personal car loan, they often believe they are purely used to purchase a new or used vehicle. In fact, a personal loan can be used to purchase a vehicle or to cover car repairs or car maintenance. You might get a great deal on a used car because it needs a new transmission or panel beating. You might discover soon after a vehicle purchase that the engine or cylinders need replacing. Our customers find that a personal car loan can be helpful in a number of scenarios: upgrading their car, for unexpected car repairs or to finance known vehicle repairs.
What is a car loan?
Your new or used vehicle purchase can be planned or come up unexpectedly if you have issues with your current vehicle and need to upgrade suddenly. The same goes for car repairs. Your mechanic may have mentioned at your last Warrant of Fitness that you will soon need some work on your camshaft or suspension, or an out of the blue breakdown may necessitate some urgent repairs.
If you don’t have enough money set aside to finance urgent repairs or a new car, a car loan (or a personal loan for a car purchase or car repairs) can be a logical solution to an expensive problem.
What is car finance?
If you’re buying a new or used car, you may be offered car finance by the car dealer to help you afford your new purchase. It always pays to do your homework to ensure you’re getting the best deal on interest rates, up front fees and ongoing fees. We’d always suggest comparing your bank lending options and personal loans. Car dealers may only offer finance through a limited number of lenders, and have less flexible loan arrangements too. Car dealers may also require an upfront deposit or a trade-in of your old vehicle too.
Importantly, a car dealer can’t offer you car finance for vehicle repairs or vehicle maintenance. Financing these types of expenses would typically come from bank lending or personal loans.
Should I get a car loan?
If speed is of the essence, because you desperately need a vehicle to get to your job or manage your household and family commitments, jumping through the application process hoops that a car dealer or bank may require of you, may not make sense. Personal loan lenders such as Nectar can help you navigate the paperwork of quick car loans through a simple online application process, with money in your account within a day.
Flexibility can also be an important factor. You may want to secure a personal loan quickly, so that you have time to chat with your mechanic and work out whether your vehicle can be fixed, or if it makes sense to purchase another. Having funds sitting in your account ready to go, can be reassuring if you’re uncertain of the outcome but need to keep things moving so you’re not without a vehicle for too long.
Our customers also use car loans in a variety of ways. You may have some savings already and just need a top up to make those necessary car repairs. Perhaps you know you have a work bonus coming up and simply need some bridging finance to cover your vehicle repair costs until your bonus lands in your bank account. A personal car loan can work flexibly to suit your individual needs. A lender like Nectar does not have early repayment penalties, so you can repay your personal loan early if you can.
It’s also worthwhile to consider if you have other avenues of funding available. If you’re on a benefit or have a lower household income, you may be able to borrow a small sum of money to help with car repairs through Work and Income.
Using a personal loan for car repairs
We understand that things can go wrong, and fast. We love to be able to help our customers back into their vehicles, quickly. Of course, there are always other funding options available. We already discussed car finance from car dealers and bank lending, but these options may not lend for car repairs, and tend to have more intensive application processes.
Other quick lending options include using an existing credit card and searching for Afterpay mechanics in your local area, but it pays to check the interest rates, up front fees and ongoing fees to assess if these are the best options for you. A lender like Nectar can approve between $2,000 and $30,000 in unsecured lending, so for more expensive car repairs, a car loan can be a more logical option.
How much can you borrow for a car loan?
With Nectar you can borrow unsecured up to $30,000, or as little as $2,000. Use our car loan repayment calculator to find out how much you could get.
Getting started with Nectar
Need a great rate on a car loan? We’d love to help with your personal loan requirements. Check out how much you could borrow and learn more about our personal loans. You can get started with Nectar and get a personalised loan quote online which will include your interest rate, maximum borrowing amount and repayment options. Borrow better, faster today!*
*Nectar’s lending criteria and responsible lending checks apply.