Car Loans for Mainly Private Use

1. Car Loan with a Fixed Rate

A Car Loan with a fixed rate is a personal finance product where a lender (bank, finance company etc) provides finance for the purchase of a car and secures the loan against that car.

Repayments on a Car Loan can be tailored to suit your budget depending on the total amount financed, term, and interest rate. The interest rate on a Car Loan with a fixed rate remains the same throughout the entire loan term.

Benefits of a Car Loan with a fixed rate may include:

•    The option to finance 100% of the total cost of the car – lets you hold onto your cash for other purposes

•    If preferred, the option to use a deposit (cash or trade-in) to lower your loan repayments

•    The flexibility to choose the type of car that suits your lifestyle

•    The ability to use the car for 100% private use

•    An interest rate that stays stable and therefore guarantees that your repayments will also remain the same throughout the entire term of the loan

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2. Car Loan with a Variable Rate

A Car Loan with a variable rate is a personal finance product where a lender (bank, finance company etc) provides finance for the purchase of a car and secures the loan against that car.

Repayments on a Car Loan can be tailored to suit your budget depending on the total amount financed, term and interest rate. The interest rate on a Car Loan with a variable rate may rise or fall throughout the entire loan term.

Benefits of a Car Loan with a variable rate may include:

•    The option to finance 100% of the total cost of the car – lets you hold onto your cash for other purposes

•    If preferred, the option to use a deposit (cash or trade-in) to lower your loan repayments

•    The flexibility to choose the type of car that suits your lifestyle

•    The ability to use the car for 100% private use

•    An interest rate that changes with market interest rate movements – if the market lowers interest rates, your loan   repayments may also decrease

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3. Novated Lease

A Novated Lease may be available to employees where your employer offers salary packaging. A Novated Lease is an agreement between your employer, the lender (bank, finance company etc) and yourself (the employee). Where your employer offers Novated Leasing, lease payments are deducted from your pre-tax income and are paid by your employer.

 

Repayments on a Novated Lease can be flexibly structured depending on the total amount financed, term, interest rate and residual value.

A Novated Lease is also sometimes referred to as Salary Packaging.

Benefits of a Novated Lease may include:

A Novated Lease can be favourable for both the employer and employee. Some benefits to the employee may include:

•    No deposit required – lets you hold onto your cash for other purposes

•    The option to lower your regular lease payments with a residual

•    The flexibility to choose the type of car that suits your lifestyle

•    The ability to keep the car even if you change jobs

•    The ability to use the car for 100% private use

•    Tax advantages through lease payments being made with pre-tax income

Need to know more?

The information above is intended to be only a guide and is not financial advice. The right finance product for you will depend on your circumstances and you should seek professional advice to assist making your decision.

Remember, you can always email us or talk to a Future Finance Specialist on 1300 790 955 between 8:30am and 6:30 pm Monday to Friday

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