💰 Does Having Equity in My Home Improve My Car Loan Chances?
If you’ve owned your home for a few years, chances are you’ve built up equity — the difference between your property’s current value and what you owe on the mortgage.
Many Australian homeowners ask: Does my home equity help when applying for car finance?
The short answer: yes — equity can absolutely improve your chances of approval and even help you qualify for lower-rate car loans.
🏡 Why Lenders Care About Home Equity
When lenders assess your car finance application, they look at your overall financial position — not just income and credit score.
Having equity in your property shows that you:
- Have financial discipline and consistent repayment history,
- Own an asset with measurable value, and
- Represent lower lending risk compared to non-homeowners.
That’s why home owners — especially those with positive equity — are usually offered better car loan rates than renters or first-time borrowers.
📈 How Equity Impacts Your Car Finance Options
Home equity doesn’t mean you’re borrowing against your house; it simply enhances your credit profile.
Lenders see equity as a sign of:
- Long-term stability (you’re not moving from rental to rental),
- Reduced default risk, and
- Solid money management.
This can translate into:
- Lower interest rates,
- Faster approvals, and
- Higher potential borrowing limits for your vehicle purchase.
Even if you’ve just refinanced your home loan, you can still apply for car finance immediately — lenders recognise your ownership status regardless of the recent changes.
🧾 Do You Need to Show Proof of Equity?
No, you don’t need to provide a property valuation or equity statement.
Before your car loan settles, lenders only require:
- A council rates notice, or
- A land title search confirming property ownership.
They don’t need to verify how much equity you have — just that you’re a property owner.
So whether you’re in your first home, an investment property, or one you share with your partner, your status as a home owner alone is enough to unlock access to low rate car loans.
💬 Final Thoughts
Having equity in your home shows you’re a stable, responsible borrower — and that gives you an edge when applying for car finance.
Even if your property is newly refinanced or still under construction, lenders still view you as a homeowner with valuable financial footing.
At Finance The Ride, we match applicants like you with lenders who reward ownership and stability with lower car loan rates and smoother approvals.
✅ Check Your Eligibility in 20 Seconds
You can start online — no upfront documents required.
Check your eligibility here and see what car loan rate your home equity could help you unlock.
DISCLAIMER
The information provided on this website is general in nature only and has been prepared without considering your financial needs, circumstances and objectives and should NOT be construed as financial, taxation or legal advice. For more information, get in touch with our experienced partner brokers today.
