FAQs

Where a lender rejects the vehicle as acceptable security for secure credit, buyers may consider an Unsecured Personal Loan.

Lenders will assess the quality of second hand vehicles as being suitable for a secure lending product. Most quality used vehicles can be funded with secure credit.

Collateral are goods which are pledged or promised or used as a guarantee against monies borrowed. Collateral is security for secure format lending products.

Insurance is required over vehicles funded with secure credit. This is required to assure lenders that should the vehicle be written-off or damaged beyond repair, they can recoup the money owed on the credit.

Chattel Mortgage, Lease and Commercial Hire Purchase would be considered as secure lending products for commercial entities.

A Secured Personal Car Loan is the lending product most popular with private buyers.

Many buyers may be approved for secure funding with no other collateral required. Where additional collateral is requested it may be provided with other assets owned or by personal guarantee.

A deposit on a vehicle purchase is typically requested by the dealer or seller as confirmation the buyer will proceed. The lender does not request a deposit as such with secure financing but may set a borrowing limit based on their assessment of the application. This may require the buyer to reduce the credit required by making a down payment.

Lenders release the security held over a vehicle with secure credit when all payments are finalised.

Buyers can use an online finance calculator to work out estimated repayments for vehicle financing.

Secure credit may be approved for poor credit profile buyers through specialist lenders.

Secure credit uses the vehicle as the guarantee against the funding. Unsecured credit does not use the vehicle being purchased as the credit guarantee. Other collateral may be requested with an unsecured product.

With secure credit, lenders register their claim over the vehicle with the PPSR. The borrower owns the vehicle in terms of being responsible for all operating costs incurred. When all payments are finalised and the security claim released, unencumbered ownership is with the borrower.

The vehicle provides security over the funds borrowed for the lender. Borrowers may receive peace of mind that should they be unable to meet repayment commitments, their vehicle may be repossessed to cover the money owed.

Interest rates on all types of vehicle financing vary across the lender market and can vary based on individual credit profiles. Secure funding attracts a lower rate than unsecured products.