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Personal Loan
A Personal Loan is a personal finance product where the financier lends the customer funds which can be used to purchase a car, but does not hold any security over the loan.
Personal Loan can also be known as an Unsecured Car Loan.
How does a Personal Loan work?
Under a Personal Loan the financier advances funds to the customer, which the customer can use to purchase a car.
The customer takes ownership of the vehicle at the time of purchase, and must repay the loan to the financier over the agreed terms.
The financier does not hold the vehicle as security for the loan.
Benefits of a Personal Loan
- Flexible contract terms ranging from 24 to 84 months (two to seven years)
- Fixed or variable interest rates
- Choice of fixed or variable interest rates
- Deposit (either cash or trade-in) may be used
- A tax deduction is available when the vehicle is used for business purposes
- The loan is secured against the vehicle, allowing lower interest rates
Who does a Personal Loan suit?
A Car Loan is suitable for individuals who wish to purchase a late model car and do not have significant business use of their vehicle or the option of novated leasing (salary packaging).
Tax implications of a Personal Loan
As a Car Loan is a personal finance product, only normal tax deductions for depreciation and running costs can be claimed (on a pro-rata basis according to the percentage of business use).
Other options
If you are considering a Car Loan you may also want to take a look at a Novated Lease (Salary Packaging), Commercial Hire Purchase (CHP) or Personal Loan, depending on your circumstances.
Want to know more?
Call us on (03) 9888 9292 and we will be happy to discuss your options with you.
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