Started looking for a new Car? Have you got your finances sorted?
Maree Woodcock is our car loan expert, who can source loans or vehicle leases via a large range of lenders, for all types of vehicles including cars, motorbikes and campervans.
We can help you with 0% car finance, leasing v’s buying options, self-employed car loans and pre-approval for finance, whether you are purchasing through a registered dealer, or private seller.
Let us do all the paperwork for you, then liase with the dealer and lender on your behalf, arrange for your funds to be drawn and payment to be made, so all you have to do, is drive away in your new car.
Simple, easy and fun.
More about car loans:
- The Truth about 0% car loans
- Lease or Buy?
- Car Loan Pre-approvals
- Car loans for the Self-Employed
1: Zero % Car Loans:
0%. Sounds too good to be true right? It pays to read the fine print because these deals may be tempting, but are often just that.
There’s no such thing as a free lunch. So it’s fair to expect that anything with a 0% interest rate will see you slugged with additional fees and charges, at some stage in the journey.
The temptations of 0% car loans:
- Eye catching offers – designed to grab your attention, and create a sense of urgency – limited time only… really?
- Less price flexibility – it’s like the “inflexible - no changes without a huge cost, no food, no bells and whistles” cheap seats on a Jetstar flight, versus the “fully flexible- make as many changes as you like, and eat on board without getting your wallet out, because you’ve paid for the privledge” expensive seats on a Qantas flight. That’s the long way of saying, you get what you pay for. The cheap seats sound generous, as does the 0% car loan, but something’s got to give to get that rate. In the case of the 0% car loan, it’s flexibility on the price of the car you are buying, or on your trade in. Upfront. Generally, that’s the flexibility that the dealer’s sacrifice to give you this rate, and still get their cut at the profit from the interest. The finance providers factor the interest costs into the upfront sales price of the car, rather than spreading the interest cost out over a series of repayments.
- Higher servicing costs – New car purchases are typically granted the 0% deal, but it’s likely you will be obliged to service your new car, by the dealer, at set intervals. If you don’t you risk voiding the warranty. The catch is, dealer services are generally more expensive than independent mechanics, and perhaps you will be locked in to more services than are required to keep your warranty. Read the fine print on this one.
- Upselling additional services– giving up their profit is not generally something you hear car dealers volunteering to do in a hurry. You can be sure that they will be attempting to beef up their profit rather than give it away via;
- Extended warranties
- Guaranteed prices on your next trade in – another way of locking you in for a future sale.
How to avoid the trap:
- Stop, compare, be informed: Do your homework! Research the market value of your car before you begin negotiations on trade in’s with a dealer. Be ready to negotiate. Don’t be pressured into signing up for an on the spot purchase. Use your broker as an out.... “I just need to speak with my broker, I’ll be in touch” .
- Speak with a car loan expert: Maree Woodcock is our car loan expert and she can compare all forms of car finance for you. Perhaps the 0% loan is the right offer for you, at least you will be making an informed decision.
2. Lease or Buy?
Having a reasonable idea about the differences between leasing and buying a car will help you make the right choice. So what’s the difference?
- Buying outright is simple: The car is yours, you can do what you like with it, simple.
- Buying via a car loan is simple: Pay a set number of monthly repayments over a 3-5 year loan term, and you own the car outright, simple.
- Leasing lets you use the vehicle, not own it. Not as simple. You still ‘pay’ for the use of the vehicle over a set term, similar to loan payments, but at the end of the lease, you may have an option of buying the vehicle by paying a lump sum ‘residual’ payment.
Types of Leases:
a) Operating Lease – like a rental agreement – once the lease ends, you hand over the vehicle and stop making payments.
b) Finance Lease – Pay a set monthly lease payment, and at the end of the lease, you can choose to pay the residual value of the car, or swap the lease over to a new vehicle and continue making monthly repayments. This option is popular with business owners who want to supply an employee with a vehicle.
c) Novated Lease – You take out a finance lease on a vehicle, but your employer makes the lease payments out of your before-tax salary. This salary-packaging reduces your taxable income, making it a win/win for both parties. The downside is that if you lose your job, you become responsible for the lease payments.
3. Car Loan Pre-Approvals:
How can we help you?
Mortgage Choice brokers have access to a range of lenders who provide car loans and can arrange a pre-approval for you whether you are purchasing through a registered dealer or private sale. When you find your car, we will liase with the lender and your dealership, to arrange for the funds to be drawn and payment to be made. All you need to do then, is drive away in your new car!
4. Car loans for the Self Employed:
If you are self-employed and need finance for a vehicle that suits your needs and business cash flow, then Mortgage Choice can help. Your car costs may be tax deductable, including the loan interest, so speak to us about Low Doc options for finance. Proof of income is a must for Lenders, so you’re your income tax returns and accounting records on hand to help with the process.
Mortgage Choice Brokers can help you with Car Finance:
- Access to a generous panel of lenders
- Streamlined process to secure finance
- We do the legwork and hunting down the right loan for you
- We crunch the numbers for you and compare the costs of different funding options
- We work closely with the lenders, so our relationships put us in a good negotiation position if your circumstances are out of the ordinary
- We help you make an informed choice
- We communicate with you every step of the way, for the life of your loan, and beyond.
Talk to Maree Woodcock today about your car loan options:
Mobile: 0421 866 700