What are the Different Types of Motor Vehicle Finance?

After purchasing a property, the next big investment can be buying your dream car. And, when it comes to buying a motor vehicle in Australia, most of us need motor vehicle finance in Sunshine Coast. It is not only a significant investment, but also a smart move on your part to pay it off in instalments. This way, you can avoid unnecessary stress on your bank account or depleting your savings. 

Now, as far as vehicle financing is considered, there are a couple of options available in Australia. Let us break it down so that you can make an informed decision.

O1. Standard Loan 

The traditional and most availed one, this simple financing option comes with either collateral or without one. Keep in mind, your vehicle is the SECURITY for the vehicle finance, so the lending institution will demand it be fully insured. The rate of interests for this loan is usually low, and the finance can also include the on-road costs. 

O2. Chattel Mortgage 

It is a fixed vehicle finance in Sunshine Coast where the lender advances the money to purchase the vehicle but holds the mortgage over the car, as a security for the loan. Here, the motorist takes ownership of the vehicle at the time of purchase with minimal capital outlay. The best part of this repayment scheme is the exemption of GST. However, a residual payment can be placed at the end of the tenure. 

O3. Commercial Hire Purchase 

Here, the financier purchases the motor vehicle and hires it to the borrower over a predetermined period. This type of finance “lease” comes with little to no capital outlay. This financing option is only available for businesses or individuals, where the vehicle is used for commercial purposes. Here, the car owner is responsible for paying the maintenance costs and trade-in residual risk of the vehicle. 

These are some of the most common options for vehicle finance in Sunshine Coast. There are alternatives as well like, novated lease, operating lease, and more.