As fuel prices keep fluctuating the demand for electric vehicles continues to soar. Across WA, lenders are starting to offer specialised car loans just for EV buyers – known as “green car finance”.
These products often have lower interest rates and favourable structures, leading many buyers to ask “why are EV loans so much cheaper?”.
As a general rule, they are cheaper – but it’s important to understand the full picture to determine whether a green car loan is actually right for you.
In this article, we run you through green car loans and EV finance. To start your application in just 4 minutes, click ‘Apply Now’.
What Is a Green Car Loan?
A green car loan is a finance product available for environmentally friendly vehicles, such as:
Plug-in hybrid electric vehicles (PHEVs)
Certain low-emission hybrid vehicles
Lenders are big fans of EVs – they’re future focused assets and better for the environment. Because of that, green car loans often come with:
Lower interest rates
Reduced fees
Specialised finance structures
Incentives for eligible vehicles
What Makes EV Loans Cheaper?
There isn’t one single reason, but after 30+ years of combined industry experience, our crew have identified a few contributing factors.
Lenders Are Competing for EV Buyers
EV demand is booming Australia-wide and lenders are competing aggressivelyfor borrowers.
Offering lower rates means they can attract the growing demand, position themselves as sustainability focused and encourage adoption of newer technology.
EVs Are Often Viewed as Lower Risk Assets
This isn’t because EVs are safer or more reliable than petrol cars, it’s because they’re newer. EVs entering the market today boast innovative technology and safety features that are far superior to most petrol offerings.
In particular, lenders like EVs that are:
New
Purchased through a dealership
Strong in resale demand
Every lender assesses risk differently, but EVs are generally looked at as a lower risk opportunity.
Government Incentives Are Encouraging EV Adoption
Depending on your state of residence and circumstances, you could be eligible for rebates, registration discounts and fringe benefits tax exemptions when you purchase an EV.
Incentives don’t lower interest rates on their own, they only boost demand – more demand = lower interest rates.
Remember: a Lower Rate Doesn’t Always Mean a Better Loan
This is one of the biggest misconceptions around electric vehicle loans. The lowest rate isn’t always the best deal and buyers should also compare:
Fees
Flexibility
Balloon payments
Repayment structure
Early payout conditions
A loan with a higher rate but more flexibility and less fees could actually be better for you long term. That’s why comparing the full structure is just as important as comparing the headline figure. .
Lower Running Costs Add to Your Savings
EV owners don’t just save on their loan. When you make the switch, you’ll also notice that you’re spending less on petrol, servicing and other maintenance.
Interest rate reductions become part of a much bigger savings picture that minimises the total cost of ownership for 5+ years.
What Makes a Strong Applicant?
Like any other form of vehicle finance, green loans aren’t open to anyone. Eligibility still depends on your financial profile.
You’re setting yourself for success if you have:
Strong credit history
Stable income
Manageable debt
The vehicle also matters. Newer models purchased directly from a dealership are more likely to attract competitive structures.
Green Loans Are Also Available to Businesses
If you’re a business owner exploring EV finance, a green loan could see you benefit from:
Lower operating costs
Tax advantages
Reduced fuel spending
Long term fleet savings
Those advantages are seeing more commercial buyers switch to EV products. We work with a panel of 40+ lenders and each of them are happy to work with WA businesses.
WA Buyers are Turning to Loans Unlimited for the Best EV Rates in Western Australia
At Loans Unlimited, our crew help buyers compare green finance options across our panel of 40+ lenders. Whether you’re looking for a pre-approval or expanding your business’ fleet, we find tailored, affordable deals for all kinds of applicants.
When you apply with us, a single application is seen by our entire panel. That means we only make one formal credit check and minimise any damage to your rating.
Apply Online for an EV Loan and Get Pre-Approved in 1 Hour
Green car finance is becoming a major product in the Australian market. But don’t be tricked by the headline figures – finding the right loan is about understanding the entire picture.
If you’re considering switching to electric, our crew can help you explore all of the options and find a structure that works with your budget and financial goals.
Click ‘Apply Now’ to get pre-approved and view interest rates on electric vehicle loans.
