Does Your Employer Offers A Novated Lease?
If you’re in the market for a new car or one that’s been previously owned by another driver, you have many options to purchase this vehicle. One of the most interesting options is a novated lease. Not all Australians are familiar with the details regarding this type of lease and how it works. A novated lease is a lease that is agreed upon between you, a vehicle finance company, and the employer you work for. It allows you to purchase a car that fits into your financial situation and your desires.
It’s a Low-Risk Buy
When you choose a novated lease, you choose a finance option that comes with a very low risk. Your employer guarantees your car lease payment is made each month by paying it for you before they pay you. This is still your money being used to pay the novated lease payment, but it’s guaranteed by your employer. You’re considered a low-risk buyer when you enter into a lease payment like a Novated Lease Calculator by Stratton Finance.
When your employer agrees to pay a finance company your novated lease payment on the due date, they agree to pay it out of your pre-tax salary. It’s good news for you because it means you get to pay less tax on a smaller income. It’s good for your financial situation in more than one way. You pay fewer taxes to the Australian government, and you get to drive a car without worrying your payments aren’t being made.
It Offers Better Approval
If you are shopping for a new or previously owned vehicle in Australia and you have a challenged financial history, a novated lease offers you a greater chance at approval. If your employer guarantees the finance company gets their money every time a payment is due, you are more likely to be approved. Since the financial aspect of your car payment is not up to you, there is no chance your employer will skip making a payment to the car finance lender.
It’s Not Always Available
Not all employers offer novated lease options for their employers. However, if you do work with a company that offers a novated lease option, it’s a good one to take. It helps you keep your finances in order by taking the option to skip a payment out of your hands, and it also helps you lease a vehicle without worrying so much about your credit history or financial statements.
Check with your employer to see if a novated lease is an option in your workplace. There is a chance you can make this happen by talking to your employer and seeing if they agree to be responsible for making your lease payments from your pre-tax income. If your company offers this lease option, it’s a good idea to keep your financial life in order and your approval chances high.