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Car Lease Melbourne

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Car Lease Melbourne

INTRODUCTION:

Whether you need a car for your personal use, for running business errands, or for expanding your company fleet, the car lease in melbourne is currently a lucrative prospect to enjoy all the benefits of owning a car, without the bindings of one. And we are here to seamlessly guide you through the entire process of it, without the inconvenience of bulk paperwork.

CAR LEASE:

A car lease is an agreement that allows a person to borrow a car from a lender (or lessor) for a stipulated period of time. The borrower (or lessee) has to make regular payments and can use the car for the time period mentioned in the contract, as per their need.

The duration of car leases varies. Generally, the average term of a car lease may be anywhere between 2-3 years, or even more.

WHAT PERCENTAGE OF CARS GET LEASED?

As per reports by Ken's research, the car leasing market in Australia is maturing rapidly. Ibis World data states that the market size of fleet vehicle leasing in Australia amounts to 2.5 billion dollars in 2022.

OPTIONS FOR CAR LEASE IN MELBOURNE:

You can choose from a range of options for car leases in Melbourne.

  1. OPERATIONAL LEASE

    In this type of lease, the lessee takes possession of the car over a decided period of time. During this period, he/she has to make monthly payments to the lessor at a pre-defined rate.

After the end of the duration of the agreement, the lessee has to return back the car to the rightful owner without any other extra payment.

  1. FINANCE LEASE

    Almost similar to an Operational Lease in terms of the monthly payment, a Financial Lease means the lessee has the obligation of buying the car at the end of the term. A balloon payment is made, covering the depreciation cost of the car (which is pre-determined during contract finalisation). This ensures ownership of the car by the lessee after the end of the agreement.

However, at the end of the contract term, you may refinance the residual amount, extend the lease, or, enter into a new lease agreement.

  1. NOVATED LEASE- 

    A novated lease means that your employer (a third party) is involved and makes the monthly payments on your behalf. The monthly payment is initiated by the Finance Department of your company from a combination of your pre-taxable and post-taxable salary.

The benefit?

Your tax-deductible amount is low.

Again, once the contract period is over, you may either make the residual payment and purchase the car, or return it back to the lessor. Refinancing the residual amount for a new lease, or trading in the car for a new one are also your post-term agreement options.

IS A CAR LEASE WORTH IT?

More than being worth it, you have to consider your budget options. Whether you do have the budget to own a car or lease it, will determine which option you should go for.

Every finance option has its own advantages and disadvantages, depending upon factors such as your financial budget, salary, savings, insurance, credit score, etc. Let’s go through some of them.

ADVANTAGES OF LEASING A CAR?

  1. A cheaper, more convenient alternative if you don’t have the immediate necessary foothold of buying a car.
  2. A good option to browse through when you are not sure which brand or model of car will be best suited for your need. By leasing a car, you have the time and choice to try out different cars.
  3. There is no legal binding.
  4. You don’t have to worry about on-road costs of service, maintenance, registration, and fuel charges for a car since most lease terms cover all of it (the cost is included in the monthly payment that you have to make).
  5. Tax deduction on lease payments if you use your car for work purposes only.

DISADVANTAGES OF LEASING A CAR?

  1. No ownership rights.
  2. No equity shares.
  3. “Fringe Benefits Tax” may be applicable in Novated Lease.
  4. There may be certain restrictions in terms of the usage of the car.

BEST LEASE TERM FOR A CAR?

Leases are usually short-term agreements, with most of them lasting for a maximum of 36 months.

IS IT CHEAPER TO OWN OR LEASE A CAR?

Leasing a car yields major short-term benefits. If you want to take your time to know the market condition before owning a car, you can lease a car in Melbourne straight away until you are absolutely sure of your choice.

If you have a poor credit score, taking a car loan for purchasing a car might not be a good choice, as interest rates may range between 10 and 15 per cent. In this case, the car lease is right for you.

CONCLUSION:

Contact us to know the best lease option for you. Our experience-enriched finance brokers will compare the rates for different options and will curate the best plan for you. We are dedicated to providing you with the best deal in the market. Our highly knowledgeable team is happy to be there at your service 24x7.