Car Loans with Defaults
Defaults on your credit file don't have to stop you getting a car loan. At Your Lending Friend, we work with specialist lenders who assess applications individually - looking at your current circumstances, not just your credit history.
Your past doesn't define your future. We've helped thousands get approved.
Having defaults on your credit file can feel like a permanent black mark. Banks see the red flags and say no without looking further. But there's more to your story than a credit report, and specialist lenders know that.
Whether your defaults are paid or unpaid, old or recent, we'll help you explore your options. Many Australians with defaults on their file are driving cars financed through lenders we work with - you could be one of them.
Paid Defaults vs Unpaid Defaults
Understanding the difference and what it means for your options
Paid Defaults
A paid default shows you've addressed the issue, even if it took time. Many specialist lenders will work with paid defaults, especially if:
- They're older (2+ years)
- There's a reasonable explanation
- Your current finances are stable
- You've maintained good payment habits since
Good news: Many lenders are willing to overlook paid defaults with the right circumstances.
Unpaid Defaults
Unpaid defaults are more challenging but not impossible. Options may be available if:
- The defaults are older
- They're for relatively small amounts
- You're on a payment plan to clear them
- Your current income strongly supports the loan
Don't lose hope: We have specialist lenders who consider unpaid defaults on a case-by-case basis.
How Many Defaults is Too Many?
There's no universal answer. Some lenders will work with multiple defaults if the circumstances make sense. What matters more is the full picture.
Total value of defaults
Lower total amounts are easier to work with than large debts.
Age of defaults
Older defaults carry less weight than recent ones.
Paid vs unpaid status
Paid defaults show you've addressed the issue, even if it took time.
Current income and stability
Steady employment and reliable income are key factors.
Loan amount requested
Smaller loan amounts relative to income improve approval chances.
Reason for defaults
Life events like illness or job loss are viewed more sympathetically than repeated poor decisions.
Real Talk About Defaults
We've helped clients with 5+ defaults get approved. We've also had to tell clients with just one default that they need to wait.
Every situation is different. The number matters less than the context. A single large unpaid default from last month is harder to work with than several small paid defaults from years ago.
The only way to know your options is to let us assess your specific situation - it's free and won't affect your credit score.
What Specialist Lenders Look For
Unlike banks, they see beyond the defaults on your file
They Focus On:
- Your current income and employment stability
- Your expenses and ability to afford repayments
- The reason behind your credit issues
- What's changed since then
- Your recent payment behaviour
They're Less Focused On:
- A single credit score number
- Old defaults (especially paid ones)
- Historical issues that have been resolved
- Rigid automated decision systems
How We Help
Our approach to getting you approved despite defaults
We Assess Your Full Picture
We look at everything - not just your defaults. Your current income, employment stability, and what's changed since the defaults occurred.
We Match You to the Right Lender
Different lenders have different policies. We know which ones are most likely to approve your situation and get you the best rate possible.
We Present Your Story
We explain the circumstances behind your defaults to lenders. Context matters, and we make sure your story is heard.
We Fight for Better Rates
Even with defaults, we negotiate on your behalf. Getting you the best rate possible means lower repayments and faster credit recovery.
Defaults Happen to Good People
A phone bill that slipped through the cracks. A medical emergency. A business that didn't work out. We've heard it all, and we don't judge. What matters is where you are now and where you want to go.
Your past doesn't define your future.
Car Loans with Defaults FAQs
Common questions about getting a car loan with defaults on your credit file
A default is listed when you fail to pay a debt of $150 or more that has been overdue for 60+ days. The creditor must send written notices before listing the default. Once listed, it stays on your credit file for 5 years from the date it was listed.
Yes, significantly. A paid default shows lenders that you've...
Yes, significantly. A paid default shows lenders that you've addressed the issue, even if it took time. Many lenders are willing to overlook paid defaults, especially older ones. Unpaid defaults make approval harder, though not impossible with specialist lenders.
There's no fixed number - it depends on the total value, age...
There's no fixed number - it depends on the total value, age, whether they're paid, and your current financial situation. We've helped people with multiple defaults get approved. The key is your current ability to repay and what's changed since the defaults occurred.
If you can afford to, paying off defaults will improve your ...
If you can afford to, paying off defaults will improve your options and potentially get you a better rate. However, if you need a car now (like to get to work), don't wait. Apply first - you can always refinance later once your credit improves.
Usually, yes. Interest rates for loans with defaults are typ...
Usually, yes. Interest rates for loans with defaults are typically higher than standard rates. However, the difference depends on your specific situation. Making consistent repayments on this loan will help rebuild your credit, potentially allowing you to refinance to a better rate in 12-24 months.
Defaults can only be removed if they were listed incorrectly...
Defaults can only be removed if they were listed incorrectly. If the default is accurate, it will stay for 5 years from the date listed. However, you can add a 'consumer statement' explaining the circumstances, which we can help lenders understand.
Still have questions? Contact our friendly team