Car shopping with my wife and baby

The Australian Car Finance Industry Needs a Shakeup

Over the last couple of days I again had the displeasure of shopping for a used car. I had forgotten how bad it was last time until yesterday. It seems in the two and a half years since I last did it, nothing had changed.

I have a fairly complicated financial situation, with quite a bit of debt from a previous failed business. I have two existing loans through ANZ, one in my name and one jointly with my wife. Plus I have an existing car loan though ANZ’s Esanda business. Pretty much all of my finances have been managed through ANZ for the last decade. I’ve never missed a payment, never defaulted and apart from multiple finance restructures my credit record is good.

Car shopping with my wife and baby
Car shopping with my wife and baby

Last time I’d done this 2 years ago, ANZ only offered the car loan through Esanda and I didn’t get the best interest rate, 9.99%. I was disappointed about it because dealer’s finance offered a better rate, but I stuck with ANZ Esanda due to brand loyalty I guess. I was shocked to discover that I couldn’t add the loan to my internet banking. Apparently ANZ’s car loan business runs on an older system to the rest of their credit system and it’s not compatible with Internet Banking.

Given my strong relationship with ANZ it seems obvious to me that I’d likely be best going to ANZ for a new car loan. They’d be most likely to approve my finance because they know my full financial history.

Should be easy as I’m already a customer. Apparently not.

I initially contacted Esanda to find out how much I have left to pay on my current loan. They quote me a balance. I’m not too sure what the point of quoting a balance is though, as the payout balance is the only thing that means anything. I was informed that payout balance they quote only lasts a few days at a time(a week maybe).

On Thursday they could only quote me a payout balance that expired that same day, because it was the regular payment day. The payout balance on Friday would be different, but their rules and computer system prevented them from telling me what Friday’s payout balance would be, despite my fixed interest rate and fixed payments. Not very helpful given I was going car shopping Friday.

They also couldn’t quote me what interest rate I would pay. The interest rate would be dependant on my application’s approval. To find out what they would offer I would have to apply for a loan pre-approval.

Why would I want to apply for a loan when I don’t know it’s terms?

Not wanting to apply for something I didn’t have full details of, I went to ANZ’s web site, where they were offering a ANZ Secured Car Loan with an online offer of 7.29%. Great, that’s a lower rate than I currently had and appeared fixed.

So I rang ANZ to ask details about it. Yes it’s rate was 7.29% if you’re approved. You’re either approved for 7.29% or you’re not getting a loan. That seemed great to me. I asked the question about Internet Banking. Turns out the ANZ Car Loans are the same thing as Esanda, running on the same antiquated, non internet-connected system. Really!

Despite that, I figured lets go for it. So I go into the online application process. Despite myself and my wife being existing ANZ customers, we fill in a huge amount of details about ourselves that ANZ already knows, such as current address, previous address and the like. We then get asked about our financial position. So we have to tell ANZ about the ANZ loans we have, which they know more about than we do.

Finally I get to the end of the process. I click Submit.

What I got after submitting my car loan application online
What I got after submitting my car loan application online

Great. My whole application was gone. I hadn’t saved it on the way through as I intended to complete the application in one go. I couldn’t apply over the phone, because the 7.29% deal was not available over the phone, only online.

So I went through the process again, this time saving at every step. Got to the end, same problem.

The next morning I tried again to submit my application. Still had the same problem. For the record, the ANZ Secured Car Loan application process is still “down for routine maintenance” this morning, two days after my first attempt.

At this point I took to twitter, complaining about my frustration. To their credit, ANZ’s social media team responded quickly:

I replied with the appropriate details and was informed they’d get a car loan officer to contact me as soon as possible.

Two days later I still haven’t received a call.

The annoying thing is, even if I had decided to apply over the phone rather than internet, I would still have to wait for a loan officer to return my call. You can just call up and apply immediately.

Overall it’s been a very poor customer service experience. I ultimately decided not to buy a car at this point, but if I had I have no doubt it’d be the same frustration as last time with back and forth between me, the bank and the dealer to finally complete the deal.

So here’s what I want to see from a car loan product by a big bank:

  • Online application that allows me to just confirm or update the existing information the bank knows about me, including the details of the loans I already have.
  • Instant online approval if the application meets pre-determined rules. If a manual intervention is required, it should be handled within 30 business minutes.
  • Funds available immediately after approval, either by real time bank transfer settlement or via my debit card.
  • The loan should be connected to my internet banking.
  • Easy online process when you want to upgrade to a new vehicle.

It shouldn’t be hard.

The technology can handle it. It’s just a case of “that’s not how we do things around here”. They’re too fixed in this old school sales model of customer service officers being commissioned salespeople. It’s time to break this old antiquated model and change to something that works for customers and provides a non-dealer finance choice that is quick and easy.