Yes. If you own a vehicle in Australia, you may be able to use it as security for a short term loan and in most cases you keep driving it throughout the loan term. This type of borrowing is called a secured personal loan, and it works differently to a car loan, a payday loan, or an unsecured personal loan. This guide explains exactly how it works, who qualifies, what the risks are, and what to expect from the process.
How Does Using a Car as Security for a Loan Work in Australia?
Using your car as security for a loan means the lender registers a legal interest in your vehicle for the duration of the loan. You keep possession of the vehicle and continue driving it as normal. If you make all repayments as agreed, the security interest is released and the vehicle remains fully yours.
The security registration is recorded on the Personal Property Securities Register (PPSR), a national database managed by the Australian government. This gives the lender a formal legal claim over the vehicle in the event of default. It does not mean the lender takes your car when you apply. It means they have a documented right to recover it if you fail to meet your repayment obligations.
For the borrower, the main benefit is access to credit that may not be available without the security. Because the lender has an asset they can recover if needed, they can often lend to people who would not qualify for unsecured loans due to a limited or imperfect credit history. The vehicle security reduces the lender’s risk, which makes the loan more accessible.
Can I Keep Driving My Car While the Loan Is Active?
Yes. In a secured personal loan arrangement in Australia, the borrower keeps full possession and use of the vehicle throughout the loan term. You drive to work, do the school run, and use the car exactly as you normally would.
This is an important distinction from pawnbroking, where the lender physically takes possession of the item until the loan is repaid. With a vehicle-secured personal loan, the lender registers a security interest on the PPSR but does not take the car. The security is a legal arrangement, not a physical handover.
The only restriction is that you cannot sell the vehicle while the loan is outstanding without first discharging the security interest. This requires paying out the loan balance, at which point the PPSR registration is removed and you are free to sell.
What Vehicles Can Be Used as Security for a Loan in Australia?
Most lenders who offer vehicle-secured personal loans accept cars as security, and many also accept motorcycles, boats, caravans, and camper trailers. The vehicle generally needs to be registered in your name, in roadworthy condition, and free of existing finance.
Quickzy accepts the following vehicles as security for a secured short term loan: cars, motorcycles, boats, caravans, and camper-trailers. The vehicle must be owned outright by the applicant, and its condition and value are considered as part of the loan assessment process.
Vehicles under an existing finance arrangement, such as a car loan that has not been fully repaid, generally cannot be used as security because the finance company already holds a prior claim over the asset. If you are unsure whether your vehicle has any existing security registrations, you can check the PPSR at ppsr.gov.au for a small fee.
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Can I Get a Loan Against My Car if I Have Bad Credit?
Yes. One of the main reasons people use a vehicle as security is that it makes loans for bad credit more accessible. Because the lender has an asset to recover if repayments are not made, they can assess the application on current circumstances rather than relying solely on credit history.
Lenders who offer vehicle-secured loans typically look at your current employment, income, and expenses alongside the vehicle’s value. A past credit issue, such as a default or missed payments, does not automatically disqualify you. What matters more is whether your current financial position demonstrates you can manage the repayments without hardship.
This is what makes secured personal loans a practical option for Australians who cannot access mainstream unsecured lending. The vehicle security changes the risk profile of the loan for the lender, which opens up access to credit that would otherwise be unavailable.
How Much Can I Borrow Against My Car?
The amount you can borrow in a vehicle-secured personal loan depends on the lender’s product range, your income and expenses, and the vehicle’s value. The loan amount is not simply a percentage of the car’s value responsible lenders must also assess affordability under Australian credit law.
Quickzy offers secured short term loans between $2,417 and $5,000, inclusive of fees, for employed Australian adults. The loan amount is determined by an affordability assessment based on your income and expenses, not solely on the vehicle’s value. Your vehicle acts as security for the loan, not as the basis for calculating how much you can borrow.
Under the National Consumer Credit Protection Act 2009 (NCCP), all licensed lenders in Australia must conduct a suitability and affordability assessment before approving any loan. This means you will only be approved for an amount the lender determines you can comfortably repay, regardless of what your vehicle may be worth.
What Are the Risks of Using Your Car as Loan Security?
The primary risk of using a vehicle as security is that if you default on the loan, the lender has the right to repossess it and sell it to recover the outstanding amount. This is a real consequence that should be understood clearly before applying.
Default means failing to make repayments as agreed. Most lenders have hardship provisions and will attempt to work with borrowers experiencing financial difficulty before exercising their right to repossess. If you anticipate difficulty making a repayment, contact your lender before the payment is missed, not after.
The responsible approach is to only borrow what you genuinely need and what your budget can comfortably accommodate. A short term loan secured against your vehicle is a practical financial tool when used for a genuine need with repayments that fit your budget. It is not appropriate for discretionary spending or as a way to access more credit than you can afford to repay.
How Does Quickzy's Vehicle-Secured Loan Work?
Quickzy offers secured short term loans between $2,417 and $5,000 for employed Australian adults, secured against a vehicle you own. The loan term is 3 to 12 months, repaid in structured instalments.
Applications are assessed on your current employment and financial circumstances. A bad credit history does not automatically disqualify you. Most applications are reviewed within 2 business hours during business hours, subject to eligibility, suitability, and affordability assessment under Australian Credit Licence 544927.
The process is fully online. You complete your application, share 90 days of bank statements, and provide details of the vehicle to be used as security. If approved, the security interest is registered on the PPSR. You continue driving your vehicle as normal throughout the loan term. When the loan is fully repaid, the PPSR registration is discharged.
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Fees, criteria, terms and conditions apply. All applications are subject to assessment under Australian Credit Licence 544927. Borrow only what you need and can afford.
What Should You Consider Before Applying for a Vehicle-Secured Loan?
Before applying, three questions are worth working through honestly: Is this the right type of loan for your situation? Can you comfortably manage the repayments without creating a new financial problem? And have you considered whether there is a better option available?
Vehicle-secured loans suit employed Australians who need between $2,417 and $5,000 for a genuine unexpected expense and whose current financial position supports the repayments. They are not the right product for someone already in financial hardship, for ongoing shortfalls in income, or for anyone who cannot afford to risk their vehicle.
If your need is smaller than $2,417, or if you do not own a vehicle, a different product will be more appropriate. The National Debt Helpline (1800 007 007) and MoneySmart (moneysmart.gov.au) both offer free guidance on borrowing options and alternatives.
Frequently Asked Questions
Yes. Using a car as security for a secured personal loan is available in Australia through licensed lenders, including Quickzy. The lender registers a security interest in the PPSR. You keep driving the car while repaying the loan. The security is discharged when the loan is fully repaid.
Yes. A secured short term loan in Australia does not require you to hand over the vehicle. You retain full possession and use of the car throughout the loan term. The lender registers a legal interest on the PPSR but does not take physical possession of the vehicle.
Quickzy accepts cars, motorcycles, boats, caravans, and camper-trailers as security for a secured short term loan. The vehicle must be registered in your name, in roadworthy condition, and free from existing finance. Vehicles with existing loans registered on the PPSR generally cannot be used.
Yes. Loans for bad credit secured against a vehicle are available in Australia. Lenders like Quickzy assess applicants based on current employment and financial circumstances rather than credit history alone. A past credit issue does not automatically disqualify you. All applications are assessed for suitability and affordability under ACL 544927.
Quickzy offers small loans between $2,417 and $5,000, inclusive of fees. The amount is determined by an affordability assessment based on your income and expenses, not the vehicle's market value alone. All amounts are subject to eligibility, suitability, and affordability assessment under Australian Credit Licence 544927.
If you default on a vehicle-secured loan, the lender has the right to repossess and sell the vehicle to recover the outstanding amount. Before reaching that point, contact your lender if you are experiencing difficulty. Most licensed lenders have hardship processes. You can also contact AFCA (Australian Financial Complaints Authority) at 1800 931 678 for assistance with disputes.
No. A car loan is used to purchase a vehicle, where the purchased vehicle acts as security. A secured personal loan using an existing vehicle as security lets you borrow money for any legitimate purpose using a car you already own. Quickzy's loans are for personal expenses, not vehicle purchases.
The Personal Property Securities Register (PPSR) is the national Australian government database where security interests in personal property, including vehicles, are registered. When a lender takes security over your vehicle, they register their interest on the PPSR. This protects the lender legally and alerts any potential buyer that the vehicle has an existing security claim against it.
Most applications submitted during business hours are reviewed within 2 hours. The process is fully online, including the application and bank statement sharing. Subject to eligibility, suitability, and affordability assessment under Australian Credit Licence 544927.
MoneySmart (moneysmart.gov.au) is run by ASIC and offers free, independent guidance on all forms of credit, including personal loans, payday loans, and secured loans. The National Debt Helpline (1800 007 007) connects you with free financial counsellors. Neither service is affiliated with any lender.
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