In Australia, leasing a vehicle is an option available to small and medium enterprises (SMEs) that still don’t have credit track records or a collateral to offer.
Yet in the long haul of doing business, many Australian SMEs still prefer owning their vehicles since the benefits of ownership outweigh the benefits of leasing. In many cases, SMEs eventually shop around for the best financing options available to them by way of Australian vehicle loans.
Why Vehicle Ownership is More Advantageous Over a Vehicle Lease
While the main advantage of using a leased vehicle is the absence of insurance, repairs and maintenance costs, this particular benefit can be affected by certain terms and conditions included in the lease contract.
Additionally, leasing also provides opportunities of getting to lease a newer model at the end of each contract. Yet leasing a newer model will result in increased sales tax and higher rate of monthly payments. In contrast, if an enterprise owns the vehicle regardless of whether purchased outright or by way of a vehicle loan, the entrepreneur has the freedom to add upgrade features or modifications to make the vehicle more responsive to the needs of the business.
Although lease payments are tax deductibles as elements of operating expenses, an enterprise can still have the same benefit when using an owned-transport equipment or vehicle; via depreciation expenses quantifying the costs of wear and tear.
Monthly lease payments are usually lower near the end of a contract, but here’s the thing, after making monthly payments during the contract term, ownership of the vehicle reverts to the lessor. Even if an enterprise purchases a vehicle on finance, the monthly payments work toward ownership of a business asset.
Besides, a vehicle loan does not require payment of hefty upfront fees, as opposed to leasing where payment of a deposit and advance lease payments form part of a lease agreement.
While there may be other reasons why the benefits of buying a vehicle outweigh the advantages of leasing, an enterprise owner must make it a point to choose wisely when entering into a vehicle financing deal. The best way to go about this is to engage the services of a licensed finance broker, whose expertise and commitment as a loans adviser is not compromised by conflicts of interests.
What to Look for When Choosing a Finance Broker
After reading the reviews coming from a long list of satisfied customers who engaged the services of National Loans Australia, we can cite certain qualities possessed by reputable finance brokers.
In addition to being holders of bonafide Australian Credit Licenses, their experience in the field of providing financial brokerage services has spanned more than 24 years. That being the case, NLA continues to maintain well-founded relationships with more than 30 traditional and new banks and financing institutions.
Moreover, National Loans Australia has the ability to broker a broad range of financing deals for various vehicles, be it for a new or used car, motorcycle, boat, caravan or commercial vehicle; such as trucks, trailers or farm equipment. NLA can even help SMEs find the best commercial loan options to buy or lease a plant or to finance an agriculture business. NLA’s commitment to customers is to help find a beneficial financing deal by tailor fitting a loan based on how much a client can afford to pay.