Finance Guide

This is the best place to find more about the most common types of car finance

Are you planning to use your car for mainly private purposes?

If you will be using your car greater than 50% of the time for private purposes, there are a number of types of finance that may fit your situation, including:

Novated Lease

…or are you planning to use your car for mainly business purposes?

If you will be using your car greater than 50% of the time for business purposes, there are a number of types of finance that may fit your situation, including:

 
 

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


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 LoanLocator Specialist on 1300 790 955 between 8:30am and 6:30 pm Monday to Friday

 back to top

 

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


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 LoanLocator Specialist on 1300 790 955 between 8:30am and 6:30 pm Monday to Friday
 

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

 back to top

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 LoanLocator Specialist on 1300 790 955 between 8:30am and 6:30 pm Monday to Friday

 
Commercial Hire Purchase

A Commercial Hire Purchase is designed for customers who ultimately want to own their car and where the car will be used mainly for business use. Regular payments are made over the contract term. Full ownership of the equipment is transferred to you when all repayments have been made.
 
Repayments are tailored to suit your budget depending on the total amount financed, term, interest rate and whether a balloon (sometimes referred to as a residual or final installment) has been set. You can even use the GST refund to contribute towards paying off the loan, thereby reducing the amount financed and the interest paid over the term of the loan.
 
A Commercial Hire Purchase (CHP) is also sometimes referred to as a Hire Purchase (HP), Offer to Hire or Corporate Hire Purchase.


Benefits of a Commercial Hire Purchase 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 repayments
  • The option to lower your regular repayments with a balloon
  • An interest rate that stays fixed and therefore your repayments will also remain the same throughout the entire contract term
  • A flexible contract term of between12 and 60 months


Potential tax implications of a Commercial Hire Purchase:

  • If you are registered for GST and use the accrual method of accounting, you may be able to claim the GST on the purchase price of the car as a lump sum when your next BAS (Business Activity Statement) is lodged with the ATO – where the accrual accounting method is used
  • The ability to manage the impact of GST, which is not payable on individual repayments or a balloon
  • The ability to claim depreciation, running costs and interest paid against your business 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 LoanLocator Specialist on 1300 790 955 between 8:30am and 6:30 pm Monday to Friday
 

 
Chattel Mortgage

A Chattel Mortgage is a type of loan designed for customers where the car will be used mainly for business use. A Chattel Mortgage is considered to be a cash sale when you immediately own the car (chattel) on purchase, but the financier takes security over it until the contract is paid in full where the mortgage is then removed.
 
Repayments are tailored to suit your budget depending on the total amount financed, term, interest rate and whether a balloon (sometimes referred to as a residual or final installment) has been set.


Benefits of a Chattel Mortgage 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 repayments
  • The option to lower your regular repayments with a balloon
  • An interest rate that stays fixed and therefore your repayments will also remain the same throughout the entire contract term
  • A flexible contract term of between12 and 60 months


Potential tax implications of a Chattel Mortgage:

  • If you are registered for GST and use the cash method of accounting, you may be able to fund the GST portion of the car’s purchase price as part of the loan and have the facility structured to allow you to claim the input tax credit when your next BAS return is lodged with the ATO
  • The ability to manage the impact of GST, which is not payable on individual repayments
  • The ability to claim depreciation, running costs and interest paid against your business 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 LoanLocator Specialist on 1300 790 955 between 8:30am and 6:30 pm Monday to Friday
 
 

Finance Lease

A Finance Lease is a type of lease designed for customers where the car will be used mainly for business use. Payments are fixed for the term of the lease, providing you with the security of knowing exactly how much to budget for.
 
For added flexibility, at the end of the lease you have several options which may include refinancing the car, trading it in or purchasing it for the residual value.
 
A Finance Lease is also sometimes referred to as a Car Lease. 
 

Benefits of a Finance Lease may include:

  • The option to finance 100% of the total cost of the car – lets you hold onto your cash for other purposes
  • The option to lower your regular repayments with a residual
  • An interest rate that stays fixed and therefore your lease payments will also remain the same throughout the entire contract term
  • A flexible contract term of between12 and 60 months


Potential tax implications of a Finance Lease:

  • If you are registered for GST, you may be able to include the GST portion of the car’s purchase price as part of the lease and have the facility structured to allow you to claim the input tax credit when your next BAS return is lodged with the ATO
  • The ability to claim running costs and lease payments against your business 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 LoanLocator Specialist on 1300 790 955 between 8:30am and 6:30 pm Monday to Friday