Options For Leasing A Car In Sydney

If you are in need of a new car, a potential alternative to buying or taking out a car loan is a lease. If you're thinking about a car lease in Sydney, here are answers to some common questions. 

How does car leasing Work?

Leasing a car typically involves renting the vehicle for a certain period of time by default. Standard lease terms range between two to five years. At the end of your lease period, you can:

• Renew or extend the lease period
• Purchase the car at its residual or current market value
• Trade the motor vehicle in and lease another vehicle.
• Return the car to your dealer and walk away.

What are the car leasing options in Sydney?

In Sydney as well as the rest of Australia, you will find several car leasing options at your disposal. The three main kinds are

• Novated
• Finance
• Operating

Let us now take a closer look at each of these options.

1. Novated car lease 

Individual employees have novated leases; they are a part of three-way salary-sacrificing agreements between employers, employees, and a finance company or dealer. Your employer deducts lease payments from your pre-tax income and pays them to the finance company or dealer in monthly settlements. The monthly payment typically includes expenses for using the vehicle, as well as fuel costs, maintenance, registration, and insurance. 

This kind of lease provides tax benefits because the amount of take-home pay is less. However, it has higher interest rates and monthly fees which push up the overall cost.

2. Finance car lease

Financial Leases are now mostly utilized by larger organizations seeking to contract their vehicle fleet management. This type of lease allows the organization to retain ownership of the asset leased by the lessor. Businesses usually have the choice of buying these vehicles at the end of the lease period via a balloon payment or renewing the lease.

3. Operating car lease

Similar to finance leases, operating leases often last for a brief period and involve no purchasing or renewal obligation. Much like long-term rental, you hand the car back over to the supplier or financier at the conclusion of a term. Operating leases make it easy to utilise the assets without having to worry about their disposal at the end of the lease term, but this convenience generally comes at a higher cost than other leases.

Is car leasing worth it?

There are no definite answers to this question. Whether it would help you or not will depend on your particular situation and needs. The kind of car leasing company you choose also makes a lot of difference; efficiency and honesty are key factors in clinching deals and you’ll find them aplenty here at Finance Brokers NSW.

All things aside, there, however, are some definite pros and cons of leasing a car. Let’s look at the good stuff first.

Pros of car leasing in Sydney

• Not having to pay the entire price of a car outright and thus enabling you to afford a better one.
• Your regular payments will probably be less expensive than regular car loan payments.
• You don't have to spend a fortune to own a car at the end of the lease period. You may opt to lease another automobile or walk away.
• There's no need to make plans for other operating and maintenance costs because they're going to be incorporated into your regular dues.
• You will be able to save on taxes by taking out a novated lease.

Now, let us look at the drawbacks.

Cons of car leasing in Sydney

• You do not own the car. On the contrary, if you take out a car loan or chattel mortgage, you are increasing your financial equity with every loan repayment.
• Higher interest rates and monthly fees can result in higher overall costs.
• You cannot modify the vehicle the way you could if you bought it.
• Potential restrictions on mileage use, such as a limit on the number of miles you may drive in a year without incurring additional charges. 
• If you cancel the lease a little earlier, you’ll likely be charged an early termination fee.

A technical thing like a car lease requires technical experts.

We have just outlined it here but if you want detailed information about car leasing in Sydney, visit our website or you can call us at 0482 075 000 or email us at lance@fbnsw.com.au. 

Also Read: Why Are Most People Taking Their Car On Lease In Sydney?