- A low-interest rate car loan can still come with costly fees.
- Charges like establishment fees, monthly account fees and early repayment penalties can add significantly to the cost of borrowing.
- Looking beyond the advertised interest rate can help you avoid costly surprises and find better-value finance.
Buying a car is exciting. Scrolling through listings, taking a test drive and finally getting the keys can make all the research feel worthwhile.
Discovering the loan comes with a laundry list of fees? Not quite the same feeling.
While most buyers focus on finding the lowest interest rate, there can be a range of extra charges lurking in the fine print. Depending on the lender, borrowers may face establishment fees, ongoing service charges, PPSR registration costs, early repayment fees and penalties for missed repayments.
On their own, these charges may seem minor. Combined over the life of a car loan, however, they can add hundreds or even thousands of dollars to the amount you ultimately repay. That's why looking beyond the advertised rate is important.
Common car loan fees: At a glance
Here's a breakdown of the most common car loan fees and what they typically cost:
| Fee | Typical cost |
|---|---|
| Application/establishment fee | $0-$500 |
| PPSR fee | $0-$30 |
| Monthly service fee | $0-$25 |
| Early repayment fee | $0-$300+ |
| Missed payment fee | $5-$60 |
Fees to look out for when getting a car loan
1. Car loan application/establishment fee
One of the most common car loan fees, the application fee (also referred to as the establishment, loan processing or loan approval fee) is charged when you initially open the loan.
It covers the cost to the lender for establishing and registering a new loan. While some lenders might require the establishment fee up front, others just add it to the outstanding loan amount.
- Don't forget, a car loan with no application fee may make up for this cost via a higher ongoing fee or interest rate.
These are the current establishment fees at the major banks as of August 2026:
| Monthly Cost | |
|---|---|
| CommBank | $250 |
| Westpac | $250 |
| NAB | $350 |
| ANZ (called loan approval fee) | $150 |
What is a car loan origination fee?
If you apply for car dealership finance, you sometimes might find an unspecific 'origination fee' on top of the establishment fee. This is often simply commission for the finance broker or dealer.
If you notice a charge like this before you sign the contract, think carefully about whether you're getting the best value for money - most major banks won't charge such a fee.
2. Car loan encumbrance/PPSR fee
Lenders may charge a Personal Property Securities Register (PPSR) fee as an additional upfront cost. This covers the cost of registering the encumbrance (security rights) on the vehicle. Some lenders charge around $25 for this, while others will simply include it in the establishment fee.
3. Car loan service fee
A lender may charge an ongoing 'service' fee on a monthly, annual or semi-annual basis. It is sometimes called a maintenance fee or simply an annual/monthly fee.
Ongoing fees are normally low, usually around $15-$20 a month, but that can add up.
Let's say that you pay $15 a month - that'll be $180 a year. If your car loan has a term of five years, this adds up to $900, which is more than most loan establishment fees.
Car loan service fees at the major banks
| Monthly cost | |
|---|---|
| CommBank | $15 |
| Westpac | $15 |
| NAB | $15 |
| ANZ (called loan administration fee) | $10 |
Rates correct as of August 2026
4. Car loan documentation fee
Within the ongoing fee might be a documentation fee (also known as a statement fee), which is the fee charged by the lender to process your paperwork and send it to you on a regular basis. It covers the work done behind the scenes by back office staff, not by the charming dealer who sold you the car.
5. Car loan early repayment fee
The early payout fee is the fee charged if your loan ends early, either because you paid it off in full before the loan term ended or you refinanced your car loan to another lender.
You may find some lenders don't charge anything for early payouts, but most do. This is because paying off a loan early can come at a cost to the lender, since they likely would have budgeted for your loan to be spread out over a certain term (say five years), earning them significantly more in interest.
A general estimate of this cost is very hard to give since lenders often base it on varying factors such as your outstanding balance or how long you have left on the loan. However, a quick scan of some popular car loans on the market shows that fees between $150 to $200 are relatively common.
6. Car loan missed payment fee
As the name suggests, the missed payment fee is charged for failing to meet repayments. You might get away without paying depending on how lenient your lender is, but more often than not you'll have to cough up.
You can avoid paying this fee by setting up a direct debit for your car loan repayments, asking them to schedule your repayments at a more convenient time (such as when you make home loan repayments), or asking for an extension if you're struggling.
Other car loan fees to watch for
- Vehicle valuation or appraisal fees
- Dealer administration fees
- Broker fees
- Redraw fees
- Loan variation fees
- Registration
- Comprehensive insurance
- Fuel
- Servicing and maintenance
- Roadside assistance
Why the comparison rate matters
One of the easiest ways to compare loan costs is by looking at the comparison rate.
A comparison rate combines the advertised interest rate with certain upfront and ongoing fees to provide a more complete picture of the loan's cost.
However, it's not perfect. Comparison rates generally don't include event-based fees such as:
- Early repayment fees
- Missed payment fees
- Redraw fees
That's why it's still important to review the loan's full schedule of fees before applying.
Savings.com.au's two cents
Before you take out any loan you should go over it carefully to find all of these kinds of charges. But while it's important to understand all the fees on the car loan, don't forget that the biggest expense is still the interest rate.
A loan might present itself as a 'low fee' or even a 'no fee' option, but what it could really be doing is hiding its high interest rate behind these slogans. Ideally, you should look for a good combination of a low rate and low fees. A low comparison rate should reflect this.
Let's do a comparison of two hypothetical car loans for a $30,000 over five years: one with a lower rate but higher fees, and one with a higher rate and no fees.
Loan one Loan two Interest rate 8.00% 6.00% Upfront fee $0 $300 Ongoing monthly fee $0 $5 Monthly repayments $608 $585 Total repayments $36,498 $35,399 So despite having a $300 upfront fee and $60 every year in monthly fees, loan two is still much cheaper overall due to its lower interest rate. Bear this in mind before you get blind sighted by advertising slogans for low fees, and remember to check the loan's comparison rate alongside the advertised interest rate.
If its comparison rate is significantly higher than its advertised rate, it probably has large fees.
In the market for a new car? Below is a selection of some of the most competitive car loan products available in Australia
| Lender | Car Loan | Interest Rate | Comparison Rate* | Monthly Repayment | Interest Type | Vehicle Type | Maximum Vehicle Age | Ongoing Fee | Upfront Fee | Total Repayment | Early Repayment | Instant Approval | Online Application | Tags | Features | Link | Compare | Promoted Product | Disclosure |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
5.94% p.a. | 7.07% p.a. | $437 | Variable | New | $8 | $400 | $36,741 |
| Promoted | Disclosure | |||||||||
5.95% p.a. | 5.95% p.a. | $438 | Fixed | New | $0 | $0 | $36,753 |
| Promoted | Disclosure | |||||||||
5.76% p.a. | 5.76% p.a. | $435 | Fixed | New, Used | $0 | $275 | $36,524 | ||||||||||||
6.24% p.a. | 6.59% p.a. | $442 | Fixed | New | $0 | $250 | $37,104 | ||||||||||||
5.99% p.a. | 6.26% p.a. | $438 | Fixed | New | $0 | $195 | $36,801 | ||||||||||||
5.67% p.a. | 6.10% p.a. | $434 | Fixed | New | $0 | $0 | $36,416 | ||||||||||||
9.99% p.a. | 10.41% p.a. | $498 | Fixed | New, Used | $0 | $0 | $41,822 |
