Novated Lease Provider comparison and experience

s00107546 on 28/01/2019 - 23:08
Last edited 30/01/2019 - 09:30

Hi all,

Long story short, where i work offer its employees salary packaging & novated lease. With a growing family, we are due to upgrade our little and reliable Toyota Corolla 2011 to a 7 seaters.

I have done some research on novated lease and it seems to be a better option at this stage (for me at least).

The company i work for is using Salary Solution for salary packaging and recommend me Smart Leasing for novated lease but after a few emails back and forth, they seem to be quite rude and pushy. Doesn't provide interest rate, try to withheld additional fee information (admin,account fee etc). Not sure if anyone have had different experiences with them but that's my take.

So I am on the hunt for another provider and hope you guys could help me out with your feedback and experience.

I'm in NSW.

Edit: Has anyone been with Stratton Finance ?

Financial

Comments

  • FoxJump on 28/01/2019 - 23:37
    +2

    I use Orix

    Very happy.
    Easy to deal with. Ok for arranging own insurance versus theirs. They happily gave me the interest rate when I asked. They let me enter reimbursement requests instead of using their fuel card.

    • s00107546 on 29/01/2019 - 13:05

      Thanks I'll check them out

      • FoxJump on 29/01/2019 - 13:35

        Yeah. I use the Woolies 5% gift cards everytime plus my shopadocket 4c off.

        The tax benefits of the lease means that the 5% gift card discount materialises as 7.5% ish. (Because they reimburse based on invoice amount - but you paid by gift card bought at discount)

        Alternatively I can use their fuel card, get stung a 50c fee each time I use it.

      • FoxJump on 29/01/2019 - 13:38

        Also, if you can afford it, i recommended only ever doing a 1 year lease. Once that ends, you can renew for another 1 year.

        The easiest to explain benefit is that if you have to terminate the lease prematurely you limit your liability to a manageable account.

        Imagine losing your job and having to pay 59 months of lease repayments (ie: including future interest) versus only 11months of future interest … Plus residual+GST. (Assuming you terminate the lease 1 month into it and assuming you want to keep the car)

  • crashloaded on 29/01/2019 - 08:39
    +1

    Some are definitely not worth it. The only thing I can suggest is get an itemized quote and do your own quotes on every aspect of their quote.

  • sheamas88 on 29/01/2019 - 08:57
    +1

    There are a few spreadsheets floating around online that give you a breakdown on total costs for different financing methods compared to a novated lease. Most of them are not perfect examples but can give you an idea on whether it's cheaper to use a lease, get a loan, or pay cash. If you use one of those and plug the figures from a lease providers quote, then you can see the total cost of purchase. Then do that for a few providers and see which one gets you the best value.

    I've only had experience with NLC, and other than their app being a bit old, then they were good to deal with.

  • Hardicus on 29/01/2019 - 10:09
    +1

    Salary Packaging Australia are who I use and they're terrible, avoid them if you can.

    • s00107546 on 29/01/2019 - 13:00

      thanks. one off the list.I made a general enquiry about a month ago and has recieved non stop calls and emails from them.

  • nivag01 on 29/01/2019 - 10:12
    +2

    Depending on your employer you may find you don't get a choice in lease provider.

    • s00107546 on 29/01/2019 - 12:59

      my employer doesn't specify which novated lease provider we need to go with.

      • FoxJump on 29/01/2019 - 13:33

        Lucky Guy!

  • onetwothreefour on 29/01/2019 - 14:20

    Toyota Finance

  • Some Guy on 31/01/2019 - 17:39

    I did the sums pretty closely and found that any "savings" were merely by way of a tax rebate at the end of the year. You'd get the same benefit by salary sacrificing into your super.

    For the car I was looking at (circa $65k), it was going to cost over $400/wk out of my take home pay. For that, I'd prefer to by an investment property. Plus I'd still have a balloon payment to keep the car or worse, a bill from the lease company because the car isn't worth what they think it ought to be. Some claim to make a profit by selling the car privately for more than the payout figure.

    I too was harangued by pushy salesman who often didn't answer simple questions like "why does your quote include GST?". In the end I just paid cash and negotiated a discount.

    Google around to see as many examples as possible.

    • gotcha on 28/02/2019 - 16:31
      +1

      Whether you can make a profit by selling at end of lease relies heavily on the car. The point is to buy cars that retain there value well and also there is high demand for them in the used car market.
      I made 1K on a Civic at end of 3 year lease, sold in hurry due to upcoming overseas holiday, then made 5K selling a Subaru Outback at end of 2 year lease.
      On the other hand, I highly doubt you would be able to make any profit if you lease car is a Ford, Holden, BMB or Audi.
      I would only get cars under 50K on 2 year lease which personally is the sweet spot for me, without doubt 1 year is the best if you can afford though.

      • s00107546 on 01/03/2019 - 08:54

        thanks mate. could i ask what car did you get ?

        2nd child underway so we needed a 7 seaters. I'm very keen on the 2019 Honda Crv Vti-e 7.

        • gotcha on 01/03/2019 - 21:23
          +1

          On my 3rd lease car atm, I am actually a Subaru fan, so mostly will get another Subbie in a few months. Also due to previous experience that they hold their value.

          I also think CRV holds its value well, and you should not have too much trouble selling it at end of lease. You might want to check out used CRVs on carsales website to get some better idea.

          I would suggest going for 2 year lease at max if you can afford for better tax benifits.

          I know some people sign for 5 year lease so they can pay less per fortnight/month during the lease, which seems make sense on the surface.
          However regardless of the lease length, you pay 20% of original purchase price of the vehicle in the form of fringe benifit tax every year from your after tax income. Let's say you bought a $40000 car, so each year you pay $8000 FBT from your after tax income. To me it does not make sense to pay $8000 FBT for this car for the 4th let along 5th year, as after three years, your car will probably only worth a bit over $20000 if not less, $8000 FBT for a $15000 to $20000 car? No way.

          Then let's look into selling your car after 5 year lease, it is most likely out of factory warranty then. Do you think potential buyers would perfer a car with or without factory warranty?

          • s00107546 on 02/03/2019 - 04:18

            @gotcha: wow. thanks man. i actually didnt think about that.

            if you dont mind me asking, are you selling your car privately on gumtree/car sale or have the novated lease company dispose it for you?

            • gotcha on 02/03/2019 - 08:11

              @s00107546: I only get cars that I know I can make profits when selling at end of lease, so I always pay the residue then sell them privately.

              Sold my Civic to sellmycar.com.au when I was in a hurry, honestly I think most people are unlikely to make much profits selling to them. As their final offers at the yard would be much lower than the quote you initially get from their website. Their quote assumes you have 4 new tyres, full year rego and CTP, etc. So there will be quite some reductions in the final offer.

              Carsales is good but they charge quite bit, so I would try not to use them to begin with. I found Carsguide pretty good, it's free to post ads there with pix, I sold two cars via them. It does not hurt to post ads on Gumtree either as it is free anyway.

              However please be super careful when selling cars online, be aware of scams. Some might claim they work on some offshore oil rigs and not able to inspect your car, etc. Ignore them. Basically if anyone offers a higher price than what you advertise something must be wrong.

            • gotcha on 02/03/2019 - 08:16

              @s00107546: pm me for more details if you like

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