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Avoid the Nasty Hidden Clauses of a Car Loan by Getting Your Next Car Through a Finance Lease Arrangement

By: Zane Burnard Click author's name for more of his/her articles

When it comes to choosing a vehicle financing option for your business, it can seem a daunting task. There are a large number of options to choose from and this can be quite confusing. What is the best option? Do the options have any concealed conditions that could cause you unexpected difficulty down the track?
If you would like to stay away from such unfavourable clauses and just have a straightforward financing option without the headaches, you may want to consider going for a standard Car Finance Lease.
How Do Finance Leases Work?
Essentially, a finance lease is a rental agreement between you and the lease provider. The lease provider will remain the vehicle owner while the lease is in force. However, unlike a conventional lease agreement, the payments you make on the vehicle will be put towards the agreed value of the car. This means that you get to own the vehicle in full once the lease is paid off. The benefit for you is that because the lease provider is the owner of the vehicle and not you, the lease provider has the responsibility of ensuring the vehicle is in good working condition. If something goes wrong with your vehicle or it cannot be used properly, then the lease company should usually transfer your lease to a similar but working vehicle. Please ensure you check the terms and conditions of your lease to confirm this is true.

What Are The Conditions to Qualify For A Finance Lease? What Are The Conditions For A Finance Lease?
To be eligible for a finance lease, the main condition is that you use the vehicle mainly for business. Every lease provider has different business usage requirements but if you want a rule of thumb, you want to make sure a minimum of 50 to 60% of the time you use your vehicle is for business. Most businesses are generally eligible for a finance lease.
Options for Finance Leases
If you decide to proceed with a finance lease, then consider the following:
- Over what length of time would you like the lease for?
- What balloon payment would you like to pay at the end of the lease? In other words, after the lease is paid, there will be a lump sum that needs to be paid. Make sure you confirm this so you are not caught out.
Some lease providers may also allow you to take out an extended lease. With this option, you can trade in your old vehicle for a new one as new vehicles become available. You will continue to pay the lease for a longer term but you now have a new vehicle.
Also, as long as you meet business usage requirements, there may be some tax deductions that you can take advantage of.
Take the time to do your research thoroughly and find the most appropriate lease. Every finance lease provider will offer you a different combination of interest rates and financing terms. So compare the different options to ensure you get the lease that best meets your business needs. Get in touch with different lease providers and chat to them - make sure you let them know that you want a quote for a business lease rather than a personal lease.
Things to compare include: interest rates, estimated payment amounts, the length of the lease and the final balloon payment. If you take the time to examine the different options and make suitable comparisons, you will be in a far better position to choose the most suitable lease option for your business.

Article Source: ABC Article Directory

About The Author: Zane Burnard, founded the Platinum Car Loans Group and is a novated lease specialist who has developed one of Australia's top fully maintained Novated Leasing products. It is a complete vehicle management solution for both individuals and companies.