The introductions and the car overview

Your first encounter with the dealer will usually be while you are looking at a car in the shop or yard. He’ll tell you a bit about the vehicle, and probably ask you your name. When he does that, ask the dealer their name also.

Cheap car loans?

Many dealers try to gauge whether you’ll be using them for financing before they negotiate a selling price. They ask what you have budgeted for monthly repayments, or tell you about a loan product they have. This is to gauge whether they’ll be making a profit on the vehicle and the used car loan, or just the vehicle. This information will drive their pricing limits.

Always avoid telling them whether you have outside financing or not … if they believe you may need financing for the car you could get a lower price on the vehicle itself.

Make an offer

When you are ready to make an offer, tell the salesman that “I’d be prepared to pay x for the car”. There are a hundred different negotiating strategies, and all are based on a strong knowledge of what that particular model is worth. Make sure you let the dealer know that the offer is subject to a satisfactory pre-purchase inspection by a qualified mechanic  (at your expense), if you want that reassurance.

Make sure you have your finance arranged beforehand

If you have gotten a particularly good deal on the car, the dealer may well choose to put a higher markup on their financing to keep their margins steady. They are not obligated to let you know what their markup on a car loan is, either! Have your Sydney car finance arranged beforehand, and you can truly get a good deal.

1. You will only be keeping the vehicle for a few years

Leasing is the preferred option when you have a high car turnover. If you’ll only be keeping a vehicle for a few years, leasing shields you from the high depreciation in the first year of ownership, as well as greatly simplifying the process of getting rid of the old car – you simply give it back to the leasing company!

2. Your lease deal can take care of insurance, registration and running costs

Some lease deals take care of maintenance and running costs as well as insurance and registration – however all lease terms differ. Sometimes you can get quite a good deal by effectively bundling the running costs, the insurance and the cost of ‘renting’ the car.

3. Because your tax position is such that a lease would be tax deductible

For some people, any amount paid on their car lease is tax deductible. Either a cheap car loan broker, or your accountant, can advise you if this will be the case. Depending on your tax bracket, you could be effectively paying only 60% of the running cost and purchase cost of the car.

4. The financier can claim back GST on the purchase price

This effectively reduces your monthly payments, and makes leasing a better deal than buying – when you would be subject to paying the full amount of GST.

In some circumstances you may have an even greater financial incentive to lease your car rather than purchase it outright with a loan; that is when you have access to salary packaging. Car leases that are paid out of pre-tax salary (when this is approved by your employer) are called novated leases, and while they are subject to FBT, can still be a significant saving.

1. Arrange a cheap car loan first

Use a car finance broker to get the best possible deal – there are brokers in Australia that actually guarantee that they will find you the best possible loan for your situation. Knowing that you have the power that ‘cash’ in your hand conveys can create an innate sense of confidence when dealing with the salesman.

2. Ask for a female salesperson if available

Make a shortlist of dealers that you would like to visit to see if they have the right vehicle for you. Then call ahead and ask if they have any female salespeople. If you are like the majority of women surveyed recently, you would probably feel more comfortable negotiating with a woman than a man. So, visit the dealerships that have female sales staff first. However, if the vehicles don’t suit you, don’t be shy to move on.

3. ALWAYS be prepared to walk away

There are literally hundreds of thousands of cars that you could buy. It does not have to be the one you are looking at right now. Never feel that you have to buy any particular car … it simply isn’t true. Even if you have taken up half an hour of the salesman’s time, even if you’ve taken it for a test drive, even if you already asked about getting a cheap car loan from the dealer. Only a signature on the dotted line prevents you walking away.

4. Know the invoice price for a new car

You can often find out what a car dealer paid for a new car model (though of course, there is no such tool for used cars!). Thinking about all the money that a dealer is making, straight from your pocket, is often incentive enough to bargain a bit harder.

5. Don’t accessorize at the dealer

If you want to get some of the extras or accessories, call around mechanics and find out what they would charge you to implement them. You’ll usually find that accessories are simply another way to increase a dealer’s margins on a car… and decrease your bank balance!

'The Dealer'

1. When you have decided on a vehicle, you have little negotiating power for the loan

Most people don’t realize that their car loan is a product they are buying, just as the car is. You should shop around for this product just as you would for the best price on your usual brand of toilet paper! If you have already decided on a car and made that emotional investment, you are much less likely to make an objective decision about whether the dealer’s loan is a good product for you.

2. Having a loan already in place could help you cut down the actual car price

When you already have a loan in place, and you don’t have to ‘ask’ the dealer for anything, you have much greater negotiating power. This extends to the price of the vehicle itself .. so you could save thousands not only on your finance, but the price of the car itself.

3. Dealers ALWAYS mark up the interest rate

Or, almost always! This is standard practice. The dealer calls the lender they are affiliated with, obtains your lowest approved interest rate, and then puts their markup on it. You can hardly get the best deal this way.

4. Dealers generally only have one lender to obtain finance from

It is not actually the dealership that is lending you the money for the car – it is a bank or other institution that they have an arrangement with. By contrast, when you obtain your used car finance through a broker, you have access to almost every loan product in the market, as well as the software and expertise to choose the one that is best for you.

1. Work out your finance before you choose a car

We know, choosing the car is the exciting part … sifting through classified ads to find a great deal on a car that’s in great shape. However, if you have bad credit, it is always advisable to work out your finance before you select your vehicle. When you have a car in mind, getting the finance becomes a race against time, and it often seems that any old loan will do. Don’t tease yourself by looking at cars before you’ve got your used car loan!

2. Use a car finance broker

There are plenty of places that offer you car loans, but the best way to get a cheap car loan (especially with bad credit) is to go to a broker. You can compare the options easily, without entering your details at multiple sites. You don’t have to suffer through the rejections that are inevitable when you try to get a bad credit car loan from a standard lender. Best of all, you can be assured that you’re getting a good deal.

3. Buy used, not new

New cars are for a very specific population segment, who has the money to afford them, but not the time to upkeep them. When you buy a new car, you are paying a premium price just for the privilege of driving a vehicle that nobody else has. This bumps the price up immensely (depreciation on new cars is often around 40% in the first year). There are thousands of great value used cars about, and with a bad credit car loan you can buy a car that is up to 10 years old.

Obtaining a lease for a vehicle can be difficult for some people and this can leave them without transport, which can pose problems for them. Now however there is another option that anyone wanting to lease a vehicle should look into and that is obtaining a novated lease. This is a type of vehicle lease which is based on an agreement between an individual, their employer and the financing company.

By obtaining a novated lease a person can own their own car and pay for it directly from their salary and then own the vehicle outright at the end of the lease term. If this sounds interesting to you here is how to obtain a novated lease for a vehicle.

Firstly it is essential that you speak directly to your employer and find out if they would be prepared to enter into a novated lease agreement with you. Some employers will already offer this option to their employees, if yours does not you could ask them to look into the potential benefits of doing so.

Once you have got confirmation that your employer accepts novated lease agreements you need to take advice on obtaining a novated lease. To get this advice you should really aim to speak to your financier, a company that provides salary packaging and your accountant. Doing this will ensure that you have all of the information that you need on novated leasing, which is vital before you enter into any type of finance agreement.

Next you need to choose the vehicle that you would like to obtain a novated lease for then ensure that the cost of the vehicle is in line with the novated lease modeling. This step is crucial in order to obtain a novated lease as each individual will have their own credit limit based on their salary.

When this has been done it is time to speak to your novated lease supplier and they will then liaise with the company you are purchasing the vehicle from. The company supplying the vehicle will then arrange for the tax invoice to be sent straight to your financer, who will be providing you with your novated lease to arrange the finance on the vehicle.

As soon as the financing (novated lease) has been approved the deed of novation will be created and sent to everyone involved to sign the agreement. When the deed has been signed you can then sit back and wait for your vehicle to be delivered to you. At the same time the department that deals with your salary will arrange for the deductions to be taken out of your wage each week or month.

As you can see obtaining a novated lease is easier than you might think. In fact as long as your employer accepts these arrangements it should be straightforward to set one up for you.

Corporate vehicle leasing also translates to having good warranties placed on the vehicles every time. If anything is wrong with a vehicle during this entire period of warranty, the company will take care of it by either fixing up the vehicle or providing another one as a replacement. The majority of leases will also cover any vehicle if it gets involved in an accident through a licensed business driver. So, there is no need to worry about losses when things like this end up happening.

In general, you should have much better luck with deal negotiation for corporate vehicle leasing than when purchasing one, as well. Several things that you can decide for yourself would include the kind and size of the vehicle, the amount of months that you will lease it, and the rate of interest you want to pay for it. There are also others things that you can decide, provided you bring it up with the company.

Routine maintenance and oil changes are usually free of charge whenever you participate in corporate vehicle leasing. This would be of the utmost essence since such things can aid in making sure that every vehicle is working as it should and is reliable.

Unfortunately, corporate vehicle leasing also comes with several disadvantages. For one, there are additional fees of mileage. With a lease, you will have a certain amount of miles that you are allowed to drive every year and if you go over that amount, you will need to shell out more money.

There is also an early termination fee. This means that if you need to end your lease earlier than originally planned, you could end up owing a huge fee. In fact, you may still have to shell out the exact amount that you initially owed for the rest of your contract. This also holds true in cases of accidents or auto theft that were beyond your control.

For several people, the advantages that come with having fairly new cars each time makes corporate vehicle leasing the perfect choice. For people driving a lot, however, buying might be the better choice. Therefore, you need to carefully take both the advantages and disadvantages into consideration to decide which transportation method would work best for you.

Naturally, there is always the option of purchasing the leased vehicle after the contract. If you come to find that you actually need several company vehicles handy, then this would be the right option to go for.

There are three main options available to anyone who wants to secure a car lease. These are – going directly to a car dealer, going to a bank and using the services of a finance broker. Here each option will be looked at in more detail.

Going directly to a car dealer – this is one option that many people will turn to when they want to obtain a car lease. Whilst this can be very useful it is not an option that is open to everyone. In fact, it is only people who tend to have a spotless credit record that can secure a great deal on a car lease using this method. This is due to the fact that car dealers do not usually want to offer a lease for a car to someone who has defaults on loans or credit cards or who has been discharged bankrupt. So if you fall into one of these categories you will probably find it hard to get a lease for a car from a dealership.

Going to a bank for a lease on a car – this is another popular way to get a car lease. However, like going directly to a car dealer this is a method that relies on having excellent credit. Banks do not like to offer car leases to people who have missed payments on other credit agreements as they are seen as a bad risk.

Using the services of a finance broker – this option is perfect for anyone, regardless of their credit history. By going to a finance broker it is possible to get a great deal on a car lease even if your financial history isn’t as good as it could be. Finance brokers will judge each application on its own merit. Meaning that if you have had problems with credit and defaults in the past, but you are now in a more stable financial position you should be able to secure a car lease.

Finance brokers work with second tier lenders and will put you in touch with lender who can offer you a car lease. These are people who specialise in bad credit car loans and will work with you to get a car lease deal that is right for you.

As you can see out of the top three options for getting a great car lease the majority of people can secure a lease through a finance broker. Brokers can help anyone to get a car lease, even if their credit is not amazing, and this is one of the reasons they are used so often.

Loans are often viewed as complicated and unpleasant necessities that are really only understood by insurance agents, brokerages, and dealers out to persuade customers to spend more money. But in reality, this is hardly the case. Car loans are, at base, simple arrangements that can sometimes become entangled in special rates, exceptions, fees, and other financing accessories. The single greatest pitfall that seekers of loans commit is focusing on the core interest rate rather than taking these accessories into account. One of the best ways to work through this issue is to hire the services of an insurance agent or broker. The service won’t be free, of course, but you can rely on a quality financing professional to sort through the language and literature of loans to give you a better sense of the deal’s bottom line. Professionals can also help you source car loans, helping you avoid potential scams and less-than-reputable loan sources.

When choosing car loans without an assistant, car shoppers can look for the comparison rate, which should factor in any penalties, extra fees, and other considerations responsible for altering the overall cost of car loans. Of course, comparing rates is a process that first requires a fair amount of looking for quotes, and though it may seem innocent enough, this is a process with a serious pitfall for many car shoppers, as well. Though it is common to have the occasional accident, credit issue, or other problem on one’s record, there’s no reason that such issues should prevent car shoppers from seeking the best car loan possible. Many deals catering solely to those who have poor or no credit may be disadvantageous in the long run, even it if it seems like getting approved right away is the best option. With diligence and a calm approach, coupled with the effort to get any erroneous marks off one’s record, car shoppers can get the car loans they deserve without resorting to second-best arrangements.

Shopping for car loans isn’t the most straightforward task confronted in modern life, but it doesn’t have to be a headache, either. Using common sense and taking advantage of available help can yield a fast and worry-free way to get into the driver’s seat.