Car Loans for Current and Discharged Bankrupts

Your status changes what a lender can do.

• Bankrupt now. It normally lasts three years and one day, and AFSA says it can be extended to five or eight years if your trustee objects to your discharge. Credit report and register: the bankruptcy shows on your credit report and on the National Personal Insolvency Index. For a car loan: you must tell a lender you are bankrupt before getting credit above AFSA's limit, and many lenders will not lend until you are discharged.
• Discharged. Your bankruptcy has ended and you are released from most debts. Credit report and register: it stays on your credit report for a time (see below), and the register shows permanently that it has ended. For a car loan: AFSA says there is no restriction on applying. It is up to each lender, and our panel includes lenders that consider discharged bankrupts.
• Annulled. AFSA describes annulment as effectively the cancellation of a bankruptcy: debts paid in full, a composition accepted by creditors, or a court order. Credit report and register: the register keeps your name with the annulment reason and date. Check your credit report shows the right status. For a car loan: tell us it was annulled and when.

Sources: AFSA and AFSA on annulment, checked October 2026. Credit reporting is not regulated by AFSA. This is general information, not legal advice.

We compare eligible options from a panel of 50+ lenders. We do not compare every lender or product in the market, and the lenders considered depend on your circumstances and eligibility. Simple Loans may receive commission from a lender if your loan settles; see our Credit Guide.

AFSA says that above a set limit you must tell a lender you are bankrupt before you buy goods or services on credit or by hire purchase, or lease or hire them. AFSA updates the limit quarterly, so check the current figure on AFSA's indexed amounts page. AFSA also warns that it is a criminal offence for a bankrupt to obtain or try to obtain credit in certain circumstances, and that severe penalties apply.

AFSA says you must give your trustee details of your debts, income and assets, and you may need to make compulsory payments if your income is above a set amount. That changes what you can afford.

Keeping or buying a car while bankrupt

AFSA says you can keep a vehicle if three things are true: your equity in it is below a set amount, you use it mainly for transport, and you keep up the repayments if it is under finance. Equity is the market value minus what you still owe, and the set amount is updated each financial year.

You can buy a vehicle while bankrupt if it is under that amount. If you get a loan to buy it, AFSA says you may need to tell the provider that you are bankrupt, and you need to pay any debts you take on during and after your bankruptcy.

If you already have a car loan

If you fall behind, the lender can repossess and sell the car, and AFSA says any shortfall can be listed in your bankruptcy. Talk to your lender about what you intend to do.

If waiting until you are discharged is the better step, we will say so.

AFSA puts it plainly: after your bankruptcy has ended, there is no restriction on applying for credit or loans. It can take time to rebuild your credit rating, and it is up to the credit provider to decide whether to lend to you.

Your credit report keeps showing the bankruptcy for five years from the date you became bankrupt or two years from when it ends, whichever is later. The OAIC states the same rule.

For example, a bankruptcy that starts in March 2023 and runs the usual three years and one day ends in March 2026. Five years from the start and two years from the end both land around March 2028. If it had been extended to five years, it would end in March 2028 and the listing would run to around March 2030.

AFSA's guidance says you can ask the credit reporting bodies to update your file to show the discharge date. Moneysmart says you can get a free copy of your credit report every three months from the two main bodies, Experian and Equifax. Your name stays on the National Personal Insolvency Index permanently, showing that the bankruptcy has ended.

• Time since discharge. Some lenders want to see a period of time since your bankruptcy ended, and how long varies.
• Income and employment. Steady income that can be verified.
• Your budget. The repayment must be affordable without hardship.
• Conduct since. How you have managed bills and any credit since the bankruptcy.
• The car and the deposit. The vehicle is usually the security, so its age, price and type matter, as does any deposit.
• Price. Expect a higher rate and stricter terms.

Before you enquire, work out a repayment you can carry and check how much you can borrow. If your file shows defaults rather than a bankruptcy, see bad credit car loans.

Different lenders use different credit criteria. We can check whether options on our panel may be worth discussing, but approval, rate and loan amount depend on the lender's assessment and responsible lending requirements.

• Photo ID.
• Payslips or other income evidence, and recent bank statements.
• Your AFSA administration number and the date your bankruptcy ended or was annulled.
• A recent copy of your own credit report, checked for errors.
• If you are bankrupt now, your trustee's details and anything your trustee has told you about income contributions.
• Details of the car and any deposit.

Each lender sets its own list. See the full documents list, and we will confirm what is needed before anything is lodged.

Moneysmart describes a debt agreement as a formal way of settling most debts without going bankrupt. AFSA's disclosure rule covers both, but the rest of the rules differ. If you are in or have finished a Part 9 debt agreement, read car loans with a Part 9 debt agreement.

A car loan is not always the answer, and we would rather tell you that up front.

• If money is already tight, a financial counsellor is free and confidential. Call the National Debt Helpline on 1800 007 007, Monday to Friday, 9.30am to 4.30pm.
• For Aboriginal and Torres Strait Islander peoples, Mob Strong Debt Help gives free legal advice about money matters on 1800 808 488.
• If you are thinking about bankruptcy now, talk to a financial counsellor before applying for new credit. AFSA explains your options.
• If someone offers to clean up your credit report for a fee, Moneysmart says you cannot remove correct information, and you can get errors fixed yourself for free.
• If you are bankrupt and the repayment would depend on not telling the lender, do not apply. The disclosure rule exists for a reason.

If the repayment would leave you short, we will say so.

We ask your status first: bankrupt now, discharged or annulled, and the dates. If you are bankrupt now, any lender we approach is told. We will not submit an application that leaves it out.

We then check which lenders on our panel may consider your situation, and explain what is realistic before you decide whether to apply.

We do not charge an upfront assessment fee. Lender fees may apply, and we may receive commission from a lender if your loan settles. Simple Loans holds Australian Credit Licence 509582 and is a member of AFCA. This page is general information and does not take your personal circumstances into account. AFSA, OAIC, Moneysmart and National Debt Helpline details were checked in October 2026.