How Many Missed Payments Before a Car Is Repossessed?

Short answer: There's no fixed number. Under the National Credit Code, a lender generally has to send you a default notice giving at least 30 days to catch up before it can repossess a car under a consumer loan. So repossession usually follows at least one missed payment and an unresolved default notice, not a single late payment. Acting early gives you the most options.

What happens after a missed payment

  1. Reminders and fees. The lender contacts you, and late fees may apply.
  2. Credit reporting. A payment 14 or more days late can be recorded in your repayment history for two years.
  3. Default notice. The lender sends a formal notice saying how much you must pay, with at least 30 days to fix it.
  4. Repossession. If the default isn't remedied, the lender may be able to repossess. It can't enter your home to take the car without your consent or a court order.
  5. Notice after repossession. The lender must write to you. You generally have 21 days to pay the arrears and costs, or introduce a buyer, before the car is sold.
  6. Sale and shortfall. If the car sells for less than you owe, you may still owe the difference, plus costs.

When a court order is needed

For loans covered by the National Credit Code, the lender must get a court order before repossessing if the amount still owing is less than 25% of the original loan amount or less than $10,000, whichever is lower. This protects people who are close to paying off their car.

Business loans are different

Loans taken mainly for business purposes, such as an ABN chattel mortgage, are generally outside the National Credit Code. The contract sets the rules, and the timeframes can be shorter. Read your loan agreement and get advice early if you fall behind.

What to do if you're behind

  • Contact your lender straight away. Ask for financial hardship assistance. You can request changes such as a payment pause, lower repayments or a longer term. Hardship arrangements are recorded separately and don't affect your credit score.
  • Get free help. The National Debt Helpline (1800 007 007) connects you with free financial counsellors.
  • Know your complaint options. If you're unhappy with the lender's response, you can complain to AFCA for free.
  • Don't hide the car. It can make things worse and add costs.
  • Consider selling voluntarily. If the loan is no longer affordable, selling privately with the lender's agreement often returns more than a repossession sale.

Moneysmart explains your rights in detail: moneysmart.gov.au.

Related guides

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General information only. This isn't financial advice. Finance the Ride is a referral service and doesn't hold an Australian Credit Licence. Last reviewed September 2026.

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All Your Questions Answered

What is a car loan and how does it work?

A car loan is a finance product where a lender provides funds for you to purchase a vehicle, which you repay over time with interest.

What’s the difference between secured and unsecured car loans?

Secured loans use the car as collateral, often leading to lower interest rates. Unsecured loans don’t, but usually have higher rates.

What loan terms are available for car finance?

Most car loans offer terms from 3 to 7 years. Find out what term suits you best.

How is interest calculated on a car loan?

Interest is based on the loan amount, term, and rate. Fixed-rate loans have predictable repayments, while variable rates can change.

Can I get a car loan for a private sale?

Yes, many lenders accept private sellers. You’ll need to provide extra documents.

Do government employees get lower interest rates on car loans?

Yes — many lenders offer better rates due to your stable income. Explore finance options for government employees.

Can I apply for a car loan while on probation?

Yes. Many workers are approved during probation.

What credit score do I need as a government employee?

A score of 650+ is ideal, but lower scores may still be considered.

Are corporate professionals eligible for low-rate finance?

Yes, especially if you're full-time with strong income.

Can I get car finance with a novated lease?

Yes, many government departments support novated leasing.

Can I get a car loan with no credit history?

Yes, it's still possible to get a car loan with no credit history.

What if I’ve been declined elsewhere?

A broker can help restructure your application for better results.

How do I check my credit score?

Use Equifax, Experian, or Illion for a free check.

Can I get finance if I have a current personal loan?

Yes, if your income supports both loans. A broker will assess your capacity.

What documents do I need to apply?

Typically: ID, payslips, and bank statements.

Can casual workers get car loans?

Yes, if you’ve worked consistently for 6+ months.

Can I apply if I’m self-employed with an ABN?

Yes. Consider a low-doc loan.

Can Centrelink be used as income?

Yes, when paired with PAYG income.

What’s the minimum income to qualify for car finance?

Most lenders prefer $30,000+ annually, but this varies.

Can I apply on a fixed-term contract?

Yes, especially if it’s government-backed.

Can I finance a used car?

Yes, most lenders allow used cars under 10 years old.

Can I get a loan for an SUV or family car?

Absolutely

Can I finance a caravan or motorbike?

Yes

Can I finance an EV or hybrid car?

Yes. You may even qualify for green car loan discounts.

Can I use my car for both work and personal use?

Yes you can.

What is a balloon payment?

It’s a lump sum due at the end of the loan term.

Can I make extra repayments?

Yes, many lenders allow this without penalty.

Can I pay off the loan early?

Yes — ask if there’s an early payout fee.

Is there a deposit required?

Not always.

What loan terms are available?

1 to 7 years is standard.

How long does approval take?

24–48 hours in most cases

Can I apply online?

Yes — most lenders and brokers accept online applications.

Is a broker better than going direct?

Often, yes. They can compare lenders for you.

Can I get pre-approved?

Yes — and it gives you better negotiating power at the dealership.

What happens after I apply?

Your documents are reviewed, and if approved, the lender issues funds to the seller.

Can I get a loan with a visa?

Yes, in some cases. see finance for visa holders here.

Do I need a driver’s licence to apply?

Yes, but learners may qualify with a co-applicant.

Can I apply with someone else?

Yes, joint applications are allowed.

Can I refinance my current car loan?

Yes — it can lower your repayments or get you a better rate.

Can I trade in my old car as a deposit?

Yes, many lenders accept trade-ins toward the deposit.

Can nurses get car finance?

Yes — see nurse-specific finance tips.

Can teachers apply while on contract?

Yes. Read how to get approved.

Do defence personnel get special car loan rates?

Yes, in some cases. Your job security is a major advantage.

Can FIFO government workers apply?

Yes — consistency in income matters more than job location.

Can I apply if I’m on maternity leave?

Yes, especially if you’re returning to work. Here’s how.

Can I use car finance to buy interstate?

Yes — just make sure the seller provides all required documents.

Can I finance a car from an auction?

Yes, but only through select lenders. Ask your broker first.

Will applying hurt my credit score?

Only if you apply to multiple lenders directly. Brokers help protect your score.

Can I get a car loan if I’ve been bankrupt before?

Yes — see bad credit car loan options.

What if I want to upgrade my car before the loan ends?

You can sell the car, pay off the loan early, or refinance.