There are very few people who go for outright purchase of the car after negotiating the discounts. In reality, almost every person who wants to own a car, for personal or for business purposes, takes a car loan or gets the car lease done for the same. There are many options of the car finance available to the car buyer to work on. He can go for any one of the following options, like:
1. Car Lease
2. Commercial Hire Purchase
3. Chattel mortgage
4. Novated lease with salary packaging
5. Fully maintained novated lease
Each of the methods is different in that there is a difference of the ownership of the title and the arrangement with the finance companies with each of these.
With these options, it is often perplexing for the prospective car buyers to figure out what type of loan arrangement they shall work out with the car finance companies. There could be a number of determinants to guide your buying decision in this regard. The online sites can also guide you in this respect. Using the differentiating criteria which can influence the choice of your decision, the sites seek answers to be input from your side in successive steps before telling you which is the best option for you.
Step 1: It might ask you to enter your status in the first go. Whether you are an individual, a sole trader, a partnership firm or a company, you are required to enter the same. The benefits to be availed of are different for each type of the business formation.
Step 2: After choosing your status, the next questions could be on the nature of your remuneration being received. Whether it is the packaged salary that you are getting or what is the system of account that you are maintaining (cash or accrual basis). The reason for asking the same is that the tax benefits for certain forms of organization are dependant on accounts maintenance and salary account types.
Step 3: It will come with the best car loan options that are available to you depending upon what you have entered before in the preceding steps. It will also tell the reasons for arriving at such a decision, like the different types of tax benefits that you can receive.
Though you can make use of these sites which offer this approach for telling which car finance option is best for you, the same shall be cross checked and verified with a chartered accountant or asked from a friend. If you are employed somewhere, then you can always ask the employer whether is a provision for the novated lease to be carried out packaged with the salary. Another reason for cross-checking the same is that the site which has in-built formula for calculating the various entries, might not have been updated. So, the result that you might be getting could be based on wrong and outdated formula calculators.
