How much deposit do you need for a car loan?
Often none. But a deposit can lower your repayments, cut the interest you pay and make approval easier in some situations. Here's when it matters, with real numbers.
My Finance Hub · Updated October 2026
Short answerOften none. Many lenders will finance the full purchase price for borrowers with good credit and steady income. A deposit still helps: it lowers your repayments and interest, and it can make approval easier if you're self-employed, have a newer ABN or have had credit issues.
Do you need a deposit?
Many lenders offer no-deposit car loans to borrowers with good credit and steady income, so a deposit isn't always required. Whether you'll need one depends on your credit history, your income, the vehicle and the lender.
When lenders may ask for a deposit
- You're self-employed with a newer ABN or limited financials.
- Your credit history includes defaults or late payments.
- The vehicle is older, has high kilometres, or is a type the lender sees as higher risk.
- You're borrowing a large amount compared with your income.
How a deposit changes your repayments
Here's a $45,000 car at an example rate of 8.5% p.a. over 5 years, with monthly repayments:
| Deposit | Loan amount | Monthly repayment | Total interest |
|---|---|---|---|
| $0 | $45,000 | $923 | $10,395 |
| $5,000 | $40,000 | $821 | $9,240 |
| $10,000 | $35,000 | $718 | $8,085 |
Example only: principal and interest, fixed rate, repayments in arrears, no fees or charges. Try your own numbers in our repayment calculator.
In this example, every $5,000 you put down saves about $100 a month and about $1,150 in interest.
Using a trade-in as your deposit
If you're trading in a car, its value can count as your deposit. If you still owe money on it, the dealer will usually pay out the old loan from the trade-in value, and only the difference goes toward your new car.
A deposit vs. a balloon
A deposit lowers what you borrow. A balloon lowers your repayments by moving part of the loan to the end. They work in opposite directions: a deposit reduces the total interest you pay, and a balloon increases it. Here's how balloons work.
Self-employed? Deposits and low-doc loans
If you're applying with BAS or bank statements instead of full tax returns, some lenders ask for a deposit, especially if your ABN is newer. Others may lend without one if your credit history is strong or you own property. We'll tell you which lenders fit before you apply. More on low-doc car loans.
FAQs
Can I get a car loan with no deposit?
Yes. Many lenders offer no-deposit car loans to borrowers with good credit and stable income. Whether you'll qualify depends on your situation and the vehicle.
Does a bigger deposit get me a better rate?
Sometimes. Some lenders price loans partly on risk, and a deposit can reduce the lender's risk. It always reduces the amount you borrow and the interest you pay.
Can I borrow for on-road costs?
Many lenders will finance the drive-away price, which includes on-road costs such as registration and stamp duty, subject to their limits.
Talk to us
Not sure whether you need a deposit? Tell us about the car and your situation, and we'll check which of our 40+ lenders fit.
Related
General information only. It doesn't take into account your objectives, financial situation or needs. Credit criteria, fees and charges apply. My Finance Hub is a Credit Representative (553769) of Purple Circle Financial Services (Australian Credit Licence 486112).