RAC Finance

RAC Finance eligibility and required documents

RAC’s FAQs state that applicants must be at least 18, Australian citizens or permanent residents, and living in Western Australia. Income must support repayments after existing commitments and living costs. The September 2026 target market determination excludes applicants who have been bankrupt within the past five years or are under a debt arrangement. Meeting these conditions does not establish approval.

Prepare identification, evidence of income and details of your expenses, existing debts and borrowing purpose. RAC determines the supporting records needed for your circumstances. Its unsecured eligibility guidance accepts an Australian driver’s licence, learner’s permit or passport and requires self-employed applicants to provide a notice of assessment no older than 18 months.

For secured borrowing, RAC must accept the asset, which must be registered in WA in the applicant’s name. Motor vehicle lending requires at least one applicant to hold a valid Australian driver’s licence or learner’s permit. Cars, caravans, camper trailers and boats must be no older than 15 years at the loan’s end; the limit is 10 years for motorcycles and jet skis. Vehicle purchases also face RAC’s safety-rating requirements.

Property-ownership discrepancy: The current target market determination does not list home or land ownership as an unsecured eligibility condition. However, RAC’s finance glossary still does. Applicants who rent should obtain confirmation before submitting a credit application.

Who an RAC personal loan may suit

The secured option may suit a WA borrower with an acceptable asset and a defined expense that can be repaid over several years. The unsecured option avoids pledging an asset but carries a higher published interest rate and a lower advertised borrowing limit.

Borrowers seeking a small amount or expecting to repay within two years should compare personal loans with lower upfront and exit costs. Someone financing an optional purchase should also compare the cost of postponing it and saving.

For debt consolidation, compare the new total repayment with the remaining cost of existing debts. A longer term can reduce the instalment while increasing total interest. Securing previously unsecured debts against a vehicle also introduces the risk of losing that vehicle.

How RAC Finance personal loans work

Application and assessment

Apply through RAC’s personal loan website or call 13 17 03. Select the borrowing purpose and whether security is available, then provide the financial and identity information RAC requests.

RAC assesses repayment capacity and conducts a credit check. Its credit reporting policy explains that application information supplied to a credit reporting body is included in your credit report. Confirm when that enquiry occurs if you initially want only a quotation.

If approved, review the loan schedule, fees, repayment dates and any security or insurance conditions before signing. Electronic signing is available through Docusign. Monthly and fortnightly repayments are advertised; discuss weekly payments with RAC if preferred.

Pre-approval and funding

RAC advertises pre-approval within seven working hours, while its FAQ describes contact within that period. This is conditional, rather than a promise of final approval or payment. Once conditions are satisfied, RAC says documents are available for signing the following business day; EFT or BPAY funds generally arrive 24–48 hours after settlement, depending on the receiving bank.

Questions to resolve before accepting an offer

• What interest rate, repayment amount and total repayment apply to my exact loan amount and term?
• Is the establishment fee paid separately or financed, and how much usable money will I receive?
• What comparison rate applies to my unsecured loan, given the published example discrepancy?
• Which asset secures the loan, what insurance is required, and what are the premium, excess and exclusions?
• What will full repayment cost before month 24, and do any early termination exceptions apply?
• What default, dishonour or enforcement charges appear in my loan schedule?

RAC Finance advantages and limitations

• Predictable repayments: A fixed interest rate supports budgeting throughout the agreed term.
• No monthly account fees: Ongoing administration charges do not add to scheduled repayments under the advertised products.
• Extra repayments: Additional payments are allowed without a separate penalty, although closing the loan within two years can trigger the termination fee.
• Upfront cost: The $499 establishment fee equals 9.98% of a $5,000 loan before interest.
• Security trade-off: Lower secured rates require an acceptable asset and associated insurance; default can put that asset at risk.
• Restricted access: WA residency rules, unsecured borrowing limits and inconsistent property-ownership guidance narrow the available options.

RAC personal loan interest rates, fees and total cost

RAC publishes the following fixed rates for general personal borrowing. Approval remains subject to assessment. The secured minimum rises to $8,000 for vehicle purchases, refinancing and debt consolidation.

Sources: RAC rates and fees and unsecured loan pricing. Comparison rates combine interest and certain fees using stated assumptions; they are not the contractual interest rate. RAC bases its published examples on $30,000 over five years and warns that different amounts, terms or fees produce different results and some charges may be excluded.

Unsecured comparison-rate limitation: The unsecured page repeats a $30,000 secured-loan basis despite advertising unsecured borrowing up to $20,000. The displayed 15.71% therefore needs clarification for an actual unsecured quotation.

Allow for the $499 establishment fee and, for secured lending, the $8 PPSR charge. If fees are added to the balance, they also attract interest. A $499 early termination fee may apply when the loan is repaid in full within 24 months. The consumer loan terms provide exceptions for refinancing through RAC, repayment wholly from an insurance claim on the security, or RAC’s agreement.

The terms also allow a scheduled default fee when a repayment remains overdue for at least seven consecutive days. Its amount must be checked in the individual schedule; no monthly account fee does not mean no charges for missed repayments.

Vehicle security must remain comprehensively insured. Confirm acceptable cover and RAC’s recorded interest, and include premiums in your budget. Check the policy’s exclusions and excess; insurance does not necessarily clear the outstanding debt after a loss.

Illustration: borrowing $10,000 unsecured

Our calculation, not an RAC quotation: At 14.95% p.a., with the $499 establishment fee paid separately upfront, a $10,000 loan over three years would require approximately $346.41 monthly and cost approximately $12,969.71 in total, including that fee. Over five years, the repayment falls to approximately $237.64, but the total rises to $14,757.22.

The longer term reduces the monthly commitment by about $109 while adding about $1,788 overall. These figures use monthly amortisation and unrounded repayments for totals, assume on-time payments and no balloon, and exclude insurance, default and early termination charges. RAC calculates interest daily, so actual payment dates and contractual treatment of fees will change the result.

Is an RAC Finance personal loan worth considering?

RAC’s strongest feature is predictable borrowing without monthly account fees. Its main limitation is the cost trade-off: unsecured borrowing carries 14.95% p.a. interest, while access to lower secured rates requires an asset and insurance. Compare the total repayment for the same amount and term, including any likely early payout, before treating the headline rate as a saving.

RAC Finance personal loan FAQs

How much can I borrow from RAC without offering security?

RAC advertises unsecured personal loans of $5,000–$20,000 over 3–5 years. Its higher advertised limit of $150,000 relates to secured borrowing, subject to assessment and acceptable security. If you need more than $20,000 without pledging an asset, compare other unsecured personal loan options before applying. Choosing RAC’s secured option also means considering insurance costs and the risk to the pledged asset if repayments fall behind.

Which RAC interest rate should I use when comparing personal loans?

Use the rate for your borrowing amount and security type. RAC’s advertised 7.70% p.a. applies to secured borrowing of $70,000 or more; its published rate for secured amounts below $30,000 is 10.95% p.a., while unsecured borrowing carries 14.95% p.a. Include the $499 establishment fee: on a $5,000 loan, that alone equals 9.98% of the amount borrowed. RAC’s unsecured comparison-rate footnote also needs clarification, as explained in the rates and fees section. Request comparable written quotations for the same amount and term.

Can I apply if I am not an RAC member or do not own a home?

Existing membership is unnecessary; RAC says borrowers become members when taking out a loan. Applicants must be Australian citizens or permanent residents living in WA. For renters seeking unsecured finance, the position is less clear: the September 2026 target market determination omits a property-ownership requirement, but RAC’s finance glossary still includes one. Confirm eligibility before submitting an application that involves a credit check.

Does RAC accept self-employed income, and what evidence is required?

RAC accepts applications from self-employed borrowers and contractors with an ABN, subject to its lending assessment. Its unsecured eligibility guidance specifies a notice of assessment dated within the past 18 months. An ABN alone does not demonstrate affordability. RAC says employment requirements vary by employment type, so applicants with a recently established business or fluctuating income should confirm the required trading history and supporting records before applying.

Could the age of my vehicle stop me getting a seven-year personal loan?

Yes. RAC requires cars, caravans, camper trailers and boats offered as security to be no older than 15 years when the loan ends. A car already 10 years old would therefore not meet that rule over a seven-year term. Motorcycles and jet skis have a 10-year end-of-term age limit, and their purchase loans run for 3–5 years under the current target market determination. Unsecured loans also have a five-year advertised maximum.

Can I make extra repayments without paying RAC’s early termination fee?

Extra repayments and closing the loan are treated differently. Additional payments are permitted without a separate penalty, but repaying the entire balance within the first 24 months may trigger a $499 termination fee. RAC’s consumer loan terms say extra payments may shorten the loan rather than reduce subsequent instalments. They also provide termination-fee exceptions, including refinancing through RAC and repayment wholly from an insurance claim on the security. Obtain a payout figure before comparing refinancing savings.

Does RAC’s seven-hour pre-approval mean a credit check and same-day funding?

RAC confirms that it checks credit files when assessing applications. Ask when an enquiry will be recorded if you only want to compare a quotation; the published guidance does not establish that pre-approval is a soft check. The seven-working-hour statement concerns contact or conditional pre-approval, not receipt of funds. RAC says EFT or BPAY payments generally arrive 24–48 hours after settlement, following completion of approval conditions and signed documents.

What charges or support should I check if repayments become difficult?

RAC’s advertised absence of monthly account fees does not remove charges for missed repayments. Its loan terms allow a default fee, specified in your individual schedule, after a repayment remains overdue for at least seven consecutive days. Contact 1300 736 290 or submit the financial hardship form, selecting finance products. Before accepting an arrangement, ask how it affects interest, the repayment period, total cost and credit reporting.

What recourse is available if RAC rejects my complaint?

Raise the issue with RAC Finance on 1300 736 290 and request a written response through its complaint management process. If dissatisfied with the response, or the complaint remains unresolved after 30 days, you can approach the Australian Financial Complaints Authority on 1800 931 678. AFCA provides free external dispute resolution, subject to its jurisdiction and time limits; an adverse lending decision alone does not establish grounds for compensation.