Lots of banks and financing companies can offer a novated car lease. There are several ways to finance your car and a novated car lease may a great option for you to consider. A novated car lease is similar to a car lease and involves regular payments like a car loan against the finance and can be on a new or used car. What makes novated car lease different is that the repayments are paid by your employer and they then deduct this amount from your gross wage. The agreement for a novated car lease includes a form for your employer and yourself, to form this arrangement.
Why would an employer arrange a novated Car Lease?
Employers may want to offer employees incentives that will motivate them to work better and stay committed to the company or organisation. A novated car lease is a great incentive for employees. The financial responsibilities and ownership of the car remains with with the employee and if you leave your job the responsibility of the lease is left to you the employee .
There are several advantages of a novated car lease and these include being able to pay for the car with your gross wages . In case you choose to terminate the lease or employment you could still continue to repay the loan for the car and own it.
Things to consider when taking a novated car lease
Once you have selected the car you wish to lease you may have to negotiate the price and monthly payments for it.
Thereafter you need to decide on the amount of fixed payment and the term of the lease. The term of the lease can be between 12 months to about five years.You may have the option of paying the residual amount at the end of the term and buy ownership of the car. The novated car lease is a unique way for employees to pay for a car, initially with small fixed payments, and thereafter with a lump sum payment. This kind of lease is agreed upon between the employer, the employee and the financing company.
Fully Maintained Car Lease
It is crucial that you are able to meet the fixed payments for the car lease. You may want to opt for a fully maintained lease. This may increase the monthly payments but will assure you proper maintenance and care for the car.If the car is predominately for business use it may be tax deductible.
A car lease is valuable for personal as well as for commercial use. The hire purchase contract is a unique way to slowly buy equity into the car until the end of the lease when with a final payment the car can be purchased.
