Quick Answer: Top 5 Car Finance Mistakes
| Mistake | The Cost | How to Avoid |
|---|---|---|
| Only checking your bank | Up to 3%+ higher interest | Compare at least 3 options (bank, broker, dealer) |
| Focusing on weekly payments | $5,000-$10,000+ over loan term | Look at total cost and comparison rate |
| Taking dealer finance blindly | Thousands in hidden commission | Get pre-approved elsewhere first |
| Ignoring fees | $500+ in hidden costs | Calculate total cost including all fees |
| Not getting pre-approved | Bad decisions under pressure | Pre-approve before car shopping |
We've helped hundreds of CQ locals finance their vehicles, and we see the same mistakes over and over. Here's how to avoid them—and potentially save thousands.
CQ quick take
Car finance in Central Queensland often looks different to Brisbane: fewer local lenders, longer distances, and a higher chance you're buying from outside the region (so you need clarity on approvals and settlement timing).
CQ finance reality check (what matters most)
- Get clear on your total cost, not the weekly repayment headline.
- Match the loan to how you actually drive in CQ (annual km, diesel vs petrol running costs, and whether you'll tow).
- If you're shopping across Rockhampton, Mackay and Gladstone, a pre-approval before you travel (or before you put a deposit down) removes pressure.
Read this before you sign anything
Australia's MoneySmart has a practical overview of car loans, fees and comparison rates: moneysmart.gov.au/loans/car-loans.
If you want help getting pre-approved and buying without the dealer finance pressure, talk to a Central Queensland car broker.
Mistake #1: Only Checking Your Bank
Your everyday bank might seem like the obvious choice for a car loan. After all, you've been with them for years. But loyalty rarely pays when it comes to finance.
Why this is a mistake:
- Banks often aren't competitive on car finance
- They have limited products—usually just one or two options
- Branch staff aren't finance specialists; they're selling what they're told to sell
What to do instead: Compare at least three options before deciding. This includes:
- Your bank
- A finance broker (like us)
- The dealer's finance (but be very careful here—see Mistake #3)
Real example: A Rockhampton client came to us after being offered 9.9% by their bank. We found them 6.9% through a credit union—saving over $3,000 in interest over the loan term.
Mistake #2: Focusing Only on Weekly Repayments
"Only $199 per week!" sounds great in an ad. But weekly repayments don't tell the whole story.
What dealers don't highlight:
- The total amount you'll repay over the loan term
- The comparison rate (which includes fees)
- The loan term length (longer term = lower payments but MORE total cost)
What to focus on instead:
- Comparison rate - This includes fees and gives you a true cost comparison
- Total cost - How much will you pay in total over the loan?
- Loan term - Shorter is usually better (even if payments are higher)
Example:
| Option A | Option B | |
|---|---|---|
| Weekly Payment | $199 | $245 |
| Loan Term | 7 years | 5 years |
| Interest Rate | 8.9% | 7.5% |
| Total Cost | $72,436 | $63,700 |
Option B costs more per week but saves you $8,736 overall. Always look at the total picture.
Mistake #3: Taking Dealer Finance Without Shopping Around
Dealer finance is convenient—but convenience comes at a cost.
Why dealers push their finance:
- They earn commission from the lender (sometimes thousands of dollars)
- They can make more on finance than on the car itself
- "We'll beat any rate" often comes with conditions that negate the savings
Red flags to watch for:
- "Sign today for this special rate" pressure
- Being told you won't get approved elsewhere
- Add-on insurances and warranties bundled into the loan
- Reluctance to show you the full loan contract
What to do: Get pre-approved elsewhere before you visit the dealer. This gives you a benchmark and removes the pressure. If the dealer can genuinely beat it, great. If not, you're protected.
Mistake #4: Ignoring the Fees
Interest rate isn't everything. Fees can significantly increase your total cost.
Common fees to check:
- Establishment fee - One-off cost to set up the loan ($0-$500+)
- Monthly account fee - Ongoing charge ($0-$15+ per month)
- Early termination fee - Cost if you pay off early or refinance
- PPSR registration - Usually $6-$10 (unavoidable)
The trap: A loan at 7% with $400 in fees might cost more than a loan at 7.5% with no fees, depending on the loan amount and term.
Always calculate the total cost including all fees before deciding.
Mistake #5: Not Getting Pre-Approved
Shopping without knowing your budget is like grocery shopping when you're hungry—you'll make bad decisions.
Benefits of pre-approval:
- Know exactly what you can spend
- Stronger negotiating position with sellers
- No surprises or disappointments
- Faster settlement when you find the right car
Pre-approval myths busted:
- "It will hurt my credit score" - A single credit enquiry has minimal impact. Multiple applications in a short period (rate shopping) are usually treated as one enquiry.
- "It locks me in" - Pre-approval is not a commitment. You can choose not to proceed.
- "It takes ages" - We can usually get pre-approval within 24-48 hours.
Get Finance Help in Your Area
We offer car finance services across Central Queensland:
Major Centres:
- Car Finance Rockhampton – Compare rates from 30+ lenders
- Car Finance Mackay – Fast pre-approval for Mackay buyers
- Car Finance Gladstone – Local knowledge, competitive rates
- Car Finance Yeppoon – Serving the Capricorn Coast
- Car Finance Emerald – Central Highlands specialists
Regional CQ:
- Car Finance Sarina – Serving Sarina and surrounds
- Car Finance Biloela – Banana Shire specialists
- Car Finance Mount Morgan – Local finance solutions
- Car Finance Clermont – Isaac Region lending
- Car Finance Moranbah – Mining town specialists
All Queensland:
- Car Finance Queensland – Statewide coverage from CQ
How We Help with Finance
At CQ Car Brokers, we work with a panel of lenders—not just one bank. This means:
- We compare multiple options to find the best rate for your situation
- We know which lenders suit different circumstances (self-employed, credit issues, etc.)
- We handle the paperwork and application process
- Our service is free to you—lenders pay our commission
Ready to get pre-approved? Start your application and we'll be in touch to discuss your options. No obligation, no impact on your credit score until you're ready to proceed.
Next steps (free help)
- Start a car finance application
- Talk to us first (no pressure)
- We can buy the car for you once you're pre-approved
- Selling your current car?
- Rockhampton car broker
- Mackay car broker
- Gladstone car broker
Frequently Asked Questions About Car Finance
Should I always go with the lowest interest rate?
Not necessarily. A lower interest rate with high fees can cost more than a slightly higher rate with no fees. Always compare the comparison rate (which includes fees) and calculate the total cost over the loan term. A 7% loan with $400 in fees might cost more than a 7.5% loan with no fees, depending on the loan amount and term.
Will getting pre-approved hurt my credit score?
A single credit enquiry has minimal impact on your credit score. Multiple applications in a short period (rate shopping) are usually treated as one enquiry. The risk of a small credit enquiry impact is far outweighed by the benefits of knowing your budget and having negotiating power. We can usually get pre-approval within 24-48 hours.
Why do dealers push their finance so hard?
Dealers earn commission from lenders—sometimes thousands of dollars per loan. In many cases, they make more profit from finance than from the car sale itself. That's why you'll face pressure to "sign today for this special rate" and may be told you won't get approved elsewhere. Always get pre-approved before visiting the dealer so you have a benchmark and negotiating power.
What's the best car loan term length?
Shorter loan terms mean higher weekly payments but significantly less total interest. A 5-year loan versus a 7-year loan on the same vehicle can save you $5,000-$10,000+ in interest. Only extend the loan term if you genuinely need the lower payments—and understand the true cost of that convenience. We always show clients both options so they can make an informed decision.
Can I pay off my car loan early without penalty?
It depends on the lender and loan type. Some loans have no early termination fees, while others charge penalties for paying off early or refinancing. Always check the early termination terms before signing. If you think you might pay off early (bonus at work, inheritance, selling the car), choose a loan with no early payout penalty even if the rate is slightly higher.
