We can access several different kinds of car leasing options for personal, self-employed or business uses.

A lease differs to a car loan in that the lender retains actual ownership of the car. They purchase the car on your behalf and you lease it back from them, paying a fixed monthly rental for the term of the lease, usually two to five years. At the end of the lease, you can pay a ‘residual value’ final payment and take ownership of the car, trade it in, or if the residual is larger than a payment, refinance the residual and continue leasing.

The benefit of this method of buying a car is that you can reduce the size of your payments by increasing the residual amount you have to pay at the end. A lease may also have some additional tax benefits, particularly if you are a business owner, self-employed or able to organise a novated lease with your employer.

With a chattel mortgage, the lender advances funds to purchase a car and you take ownership.

Many people have never heard of a chattel mortgage and that’s because it is usually obtained by businesses for vehicles that are primarily used for business purposes. The lender takes out a ‘mortgage’ using the car as security for the loan. This mortgage is registered with ASIC and once the contract is completed, it is removed giving you ownership of the car.

You can finance the chattel mortgage over two to five years, arrange for a residual value to reduce the cost of your payments, and use a trade-in or cash as a deposit to further reduce your payments.

New Car Loans are suitable for buying cars that are brand new, some lenders also consider motor vehicle as old as 3 years as a security for this type of loan. New cars are generally worth more than older models, so you might be able to negotiate a competitive interest rate. Typically, a new car loan will be secured by the value of the car plus the cost of any factory optional extras such as alarms, tinted windows etc.

Used Car Loans are available for the purchase of cars that are too old to qualify for a new car loan. Again, a used car loan is usually secured by the value of the car, in some cases the lender may require to have the vehicle inspected. If a motor vehicle is more than 5 or 6 years old, it might be too old to qualify for a used car loan, and you will have to apply for an unsecured car loan this is an unsecured personal loan it is important to understand that unsecured personal loans may higher fees and interest rates.