Learn about your options for financing a car as an apprentice and how to navigate the process with Savvy.
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Being an apprentice is a fantastic way to gain valuable skills and experience while earning a qualification. However, the lower income associated with apprenticeships can make it difficult to afford what you need – especially when it comes to bigger expenses like a car. Luckily, there are loan options available to help apprentices with their finances. Get started with Savvy.
Securing a car loan as an apprentice in Australia can be challenging. Unlike certain specialised loan products, there aren't specific apprenticeship car loans. The primary hurdles many apprentices face are their potentially lower income levels compared to established workers and their limited credit history due to their age and career stage. As a result, traditional lenders may view apprentices as higher risk borrowers.
However, while obtaining a car loan as an apprentice may be more difficult, it's not impossible. Some lenders may offer more flexible eligibility criteria that accommodates individuals with limited credit history or irregular income streams, such as apprentices. These programs may take into account factors such as the apprentice's future earning potential and stability in their chosen field – though keep in mind that you may face higher interest rates.
As a young apprentice, you will likely be new to the world of car finance, but it’s important to know how it works. Applying for a car loan in Australia typically involves several steps:
Loans aren’t one-size-fits-all, so it’s important to explore your options. Here are some tips to find an apprentice loan that best suits your needs:
If you don’t qualify for a traditional car loan as an apprentice, there are other options you can explore to help finance a car:
Having a guarantor (usually a parent or other close relative with a good credit history) can significantly increase your chances of loan approval. The guarantor agrees to cover your loan repayments if you are unable to do so, which assures the lender that the loan will be repaid even if the borrower is unable to. However, it’s important to carefully consider the implications of having a guarantor, as missed payments can negatively affect their credit score as well.
Personal loans can be used for various purposes, including purchasing a car. Compared to secured car loans, personal loans typically have higher interest rates because the lender doesn't have the security of the car itself. However, if you are looking to buy a cheaper used car, this might be a suitable option.
Australian Apprenticeship Support Loan
Some apprentices in Australia have access to Australian Apprenticeship Support Loans, which can help apprentices manage their day-to-day expenses while undergoing their apprenticeship training. For 2023–24, these loans offer financial assistance of up to $24,492 and do not need to be repaid until the apprentice's income exceeds the minimum repayment threshold, currently $51,550. There are no stipulations on how the funds are used, meaning the loan could be put towards purchasing a vehicle.
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Quantum Savvy Pty Ltd (ABN 78 660 493 194) trades as Savvy and operates as an Authorised Credit Representative 541339 of Australian Credit Licence 414426 (AFAS Group Pty Ltd, ABN 12 134 138 686). We are one of Australia’s leading financial comparison sites and have been helping Australians make savvy decisions when it comes to their money for over a decade.
We’re partnered with lenders, insurers and other financial institutions who compensate us for business initiated through our website. We earn a commission each time a customer chooses or buys a product advertised on our site, which you can find out more about here, as well as in our credit guide for asset finance. It’s also crucial to read the terms and conditions, Product Disclosure Statement (PDS) or credit guide of our partners before signing up for your chosen product. However, the compensation we receive doesn’t impact the content written and published on our website, as our writing team exercises full editorial independence.
For more information about us and how we conduct our business, you can read our privacy policy and terms of use.
© Copyright 2024 Quantum Savvy Pty Ltd T/as Savvy. All Rights Reserved.
© Copyright 2024 Quantum Savvy Pty Ltd T/as Savvy. All Rights Reserved.
Quantum Savvy Pty Ltd (ABN 78 660 493 194) trades as Savvy and operates as an Authorised Credit Representative 541339 of Australian Credit Licence 414426 (AFAS Group Pty Ltd, ABN 12 134 138 686). We are one of Australia’s leading financial comparison sites and have been helping Australians make savvy decisions when it comes to their money for over a decade.
We’re partnered with lenders, insurers and other financial institutions who compensate us for business initiated through our website. We earn a commission each time a customer chooses or buys a product advertised on our site, which you can find out more about here, as well as in our credit guide for asset finance. It’s also crucial to read the terms and conditions, Product Disclosure Statement (PDS) or credit guide of our partners before signing up for your chosen product. However, the compensation we receive doesn’t impact the content written and published on our website, as our writing team exercises full editorial independence.
For more information about us and how we conduct our business, you can read our privacy policy and terms of use.
