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Car finance
Dealer finance is convenient, but convenience has a price. Knowing the real cost before you sign gives you room to negotiate.
By Yatin Kainth, Financial Adviser FSP1007497. Last reviewed
Short answer
Vehicle loans in NZ are usually secured on the car, over one to seven years, with rates depending on your credit, the lender and the vehicle’s age. Dealer finance, bank or finance company loans and mortgage top-ups are the main options. Compare the total cost including fees, not just the weekly repayment.
Weekly repayment
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Monthly repayment
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Total interest and fees
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Fees are added to the loan, which is common with car finance. Example rate only. Your rate depends on the lender, the vehicle’s age and your credit.
| Option | Good for | Watch for |
|---|---|---|
| Dealer finance | Speed and convenience at the yard | Fees, add-on insurance, and less room to negotiate the price |
| Bank or finance company | Comparing rates before you shop | Pre-approval expiry dates |
| Mortgage top-up | Lowest rate if you have equity | Spreading a car over 25 years. Set a short term. |
| Green or EV loans | Discounted rates on electric and hybrid vehicles at some lenders | Eligibility rules |
There’s no single cut-off. Better credit gets better rates. Some lenders specialise in lower scores at higher rates.
The rate is lower, but set it up as a separate short-term portion that’s repaid in 3 to 5 years. Otherwise you pay interest on the car for decades.
Yes. Most lenders fund private sales. Check the PPSR to make sure there’s no money owing on the car.
Banks treat car repayments as an expense, which reduces how much you can borrow. Plan the order if you’re buying a home soon.
A 20-minute chat costs nothing. I will tell you straight what lenders are likely to say.
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