What is a car finance broker?

A car finance broker or a car loan broker is an accredited individual or company that has access to a range of lenders to help people find a car loan that suits their needs. Instead of seeing just one lender with their own loan products, brokers can look for loans from many different and independent lenders at the same time. Brokers can save money and time for people looking for car loans as they search for the best deal on the car buyer’s behalf. They can also look for competitive rates and terms for bad credit customers, loans with pre-approval, and for business customers looking for a car loan.

How a car finance broker could help your credit score

Every car loan broker in Australia should be accredited by the Australian Investments and Securities Commission (ASIC) with an Australian Credit Licence (ACL.) A broker’s ACL shows consumers that they follow responsible lending rules as laid out in the National Consumer Credit Protection Act 2009.

You can check a broker is accredited using the ASIC Register. If your broker is not accredited, walk away.

According to the Act, credit licensees “must not enter a contract with a customer, suggest such a contract, or assist a customer to apply for a credit contract if that contract is unsuitable for that customer’s situation.”

This means that a broker, once they have made a preliminary assessment of your creditworthiness and find that a loan is not suitable for your financial situation, should not approach their lending panel and submit your details for an application. The lender will make a credit check and could reject your application, which has the potential to harm your credit score.

Brokers should adhere to the “three pillars” of responsible lending, which are:

  • Making reasonable enquiries about an applicant’s financial situation,
  • Verifying or checking their situation is as they describe; and,
  • Figuring out if their financial situation can support the loan they are asking for.

Brokers also must make sure the final loan contract is easy to understand. They also need to supply, in writing, their copy of the assessments if requested.

Estimate your loan repayments with our handy car loan calculator

LenderProduct NameAdvertised RateComparison RateMonthly Repayment
SavvyNew Car Loan2.85%
fixed
3.93%$537.06
Bank of AustraliaUsed Car Loan6.45%
variable
6.66%$586.28
ANZOnline Secured Car Loan7.85%
fixed
8.70%$606.14
CUAFixed Rate Car Loan7.99%
fixed
8.29%$608.15
BankSASecured Fixed Personal Loan8.49%
fixed
9.39%$615.35
St GeorgeSecured Fixed Personal Loan8.49%
fixed
9.39%$615.35
CBASecured Car Loan8.49%
fixed
9.54%$615.35
NABVariable Rate Personal Loan14.19%
variable
15.06%$701.01

* Commercial loan with the loan amount of $40,000 is looking at a 5 year secured fixed rate of 2.85% p.a. and comparison rate of 3.93% p.a.. WARNING: all fees and charges may not be included on the example above, only the comparison rates, monthly repayment and total cost applies. Therefore, the total cost of the loan might be different. Comparison rate do not include broker fees, redraw fees, early termination fees and fee waivers. Comparison rate may change as a result of the different loan terms, fees and the loan amounts. Establishment fees and monthly fees do not apply to commercial loans, only consumer loans. However, there might be different fees apply.

Why choose Savvy?

Savvy is consistently among the top brokers in Australia when it comes to trust and value.

Accredited and trusted brokers
Savvy is consistently among the top brokers in Australia when it comes to trust and value.
25+ lending panel
We have over 25 banks and lenders all competing for your business, giving you more competitive rates.
Dedicated loan consultants
Your dedicated loan consultant does all the hard work for you, looking for a loan that suits you best.