Short answer: Buying a car with finance usually runs in this order: work out your budget, get pre-approval, choose the car, have the lender approve that specific vehicle, sign the loan documents, arrange insurance, and then the lender pays the seller. How long it takes depends on your paperwork, the lender and whether you're buying from a dealer or privately.
Step 1: Set a realistic budget
Start with the repayment you can comfortably afford, not the car you want. Allow for insurance, rego, fuel, servicing and tyres as well. Example only: $30,000 over 5 years at 9% p.a. is about $623/month, before fees. Your actual rate depends on the lender, your credit history and the car. Our guide to the true cost of a car loan covers fees and comparison rates.
It's also worth getting a free copy of your credit report from the credit reporting bodies before you apply, so there are no surprises.
Step 2: Get pre-approval
Pre-approval tells you roughly how much a lender will lend, subject to conditions. It usually involves a credit check, and it lasts a limited time. You'll typically provide ID, payslips or other income evidence, bank statements, and details of your expenses and debts. See the documents checklist.
Step 3: Choose the car and check it
- Dealer purchase. Ask for a tax invoice or contract of sale with the VIN, price and any extras itemised.
- Private purchase. Get the seller's details, the VIN and rego, and run a search on the PPSR to check the car isn't under finance, written off or stolen. Lenders often run their own checks too.
- Safety or roadworthy certificate. Whether one is needed depends on your state.
Step 4: Formal approval, documents and settlement
| Stage | What happens |
|---|---|
| Formal approval | The lender approves the loan for that specific car and price |
| Loan documents | You receive the contract, often by e-signature. Check the rate, fees, term, any balloon and early payout costs. |
| Insurance | Most secured car loans require comprehensive insurance from settlement |
| Settlement | The lender pays the dealer or seller, and you collect the car |
| Rego transfer | Transfer the registration and pay stamp duty through your state transport authority, within its deadline |
With a dealer, the dealer usually handles the rego and stamp duty. With a private sale, both buyer and seller normally have to lodge their parts of the transfer.
Common hold-ups and how to avoid them
- Payslips or bank statements that don't match what you told the lender about your income
- Undisclosed debts, such as buy now pay later accounts, showing up on your credit file
- A private seller who still owes money on the car and can't show a payout letter
- Dealer add-ons (warranties, protection packages) inflating the loan amount. You can say no to these.
If you're weighing up where to get the loan, see dealer finance vs bank loans.
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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.
