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The $1,000 repossession fee hiding in your car loan

Published 27 days ago • 3 min read
The Gusto Brief — Issue #5
Struggling with repayments? There are more options than you think.

The Gusto Brief

Issue #5 · 25 May 2026

In this issue

→ Transport costs spiked 5% in one month . Did the promised relief arrive at the pump?
→ Stuck in a loan you can’t afford? Five ways out, before it gets worse.
→ Used car repossessions are up . What the data says about financial stress in the market right now.
 

Fuel & transport

Transport costs spiked. Relief is on the way. But don’t hold your breath.

The biggest driver of higher household costs in March wasn’t groceries. It wasn’t rent. It was getting to work.

ABS data released this month shows household spending rose 1.6% in March overall. But transport costs jumped 5.1% in a single month. Fuel prices surged 32.8% as the Middle East conflict pushed oil prices higher. Australians were spending more just to cover the same distances.

The short version: if your budget felt genuinely tighter in March and April, that’s why.

Here’s what that means for you

When fuel costs spike, lenders tighten. Transport expenses are factored into living cost calculations when lenders assess a car loan application. A 32.8% spike in fuel doesn’t just hurt your wallet. It shrinks your assessed borrowing capacity. If you were planning to apply for finance in the next few months, timing matters more than usual right now.

Here’s the update since: the federal government moved quickly, halving the fuel excise from April. The ACCC’s latest weekly monitoring report (22 May) confirms the 26.3 cents per litre cut is flowing through to the bowser. Prices are now “significantly lower” than before the excise reduction. That’s real relief.

But it’s not a return to normal. Fuel is still more expensive than it was 12 months ago. Westpac is forecasting further RBA hikes before year’s end, which would push variable car loan rates higher again.

The squeeze isn’t over. It’s just slightly less tight.

Sources: ABS household spending data  |  ACCC fuel price monitoring, 22 May
 

From us

If the last few months have you wondering whether your current car loan still makes sense, you’re not alone. Between three consecutive rate hikes and fuel costs spiking 32.8% in March, a lot of car owners are crunching the numbers differently right now.

The Gusto Finance team compares options across 50+ lenders to find the right fit for your situation. Whether you’re looking to refinance or starting fresh, we can give you a clear picture without affecting your credit score.

Worth a look →
 

Car finance

If your repayments are becoming unmanageable, read this before you miss one.

The most expensive mistake you can make with a car loan you can’t afford is doing nothing.

A single missed payment, corrected quickly, has minimal impact. But let it run to 14 days and it shows on your credit file. Push past 60 days and you’re looking at a default listing that stays there for five years. After that, mainstream lenders won’t come near you.

Here’s what actually works instead.

Contact your lender before you miss a payment. Under Australian hardship provisions, lenders are legally required to consider relief options: reduced payments, a repayment pause, or a restructured term.

If that conversation doesn’t go anywhere, you have other options: refinance to lower your monthly repayments, sell the car privately (you’ll get more than auction), or surrender it voluntarily to avoid the roughly $1,000 in repossession fees that get added onto what you owe.

Free financial counselling is also available if you want an independent view. The National Debt Helpline (1800 007 007) is a good starting point.

Full guide: how to get out of a car loan you can’t afford →
 

Market data

One number in this week’s used car data is worth watching.

Datium Insights’ weekly update (18 May) shows overall used car prices fell 1.1% last week. Gradual softening. Nothing unusual there.

But one figure stands out: repossessed vehicle prices fell 20.7% in a single week. That’s not a pricing trend. That’s a volume signal. More cars entering the repossession channel pushes prices down as supply builds.

It’s one week of data, so don’t read too much into it. But if you’re finding repayments hard to manage right now, the timing of that Gusto article above is not a coincidence. The options are there. The earlier you act, the more of them are available to you.

Datium Insights weekly market update →
 

Also from the Gusto Financial Group

→ Gusto Home Loans. We do for home loans what we do for car finance. Compare options across a large lender panel, whether you’re buying, refinancing, or just want to know your borrowing power.

→ Gusto Auto. Our Brisbane-based used car dealership. Buy a quality used vehicle from us while Gusto Finance handles the loan.

→ Gusto Cash. Need access to funds fast? Flexible personal cash loans for when life happens outside of a standard car or home loan.
 

The Gusto Finance Team

1130 Kingsford Smith Dr, Eagle Farm QLD 4009
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