Buying a car is an exciting time, but it can come with a hit to your hip pocket. Not only are you buying a car, you are also paying for registration, stamp duty and sometimes other costs.
You may be pleased to learn stratton can wrangle many of these pesky extra costs into your loan, so you can enjoy your new ride without having to fork out for these up-front.
We've written this article in general terms to help you understand what typically can and can't be included in your loan amount. The usual terms and conditions apply - credit will be offered to approved applicants only and your application will be subject to standard lending criteria - so check with a stratton finance consultant to find out what's available to you.
At a glance: what extra costs can I add into my car loan?
- Registration: Yes
- Stamp Duty: Yes
- Negative Equity: Sometimes
- Compulsory Third Party: Yes
- Consumer Credit Insurance (CCI): Yes
- Comprehensive Car Insurance: Yes
- GAP/Motor Equity Insurance: Yes
- Scheduled Servicing: No*
- Transportation Costs: Not usually, but ask your consultant
- Additional Assets: No
*Some of these costs may be included in a Fully Maintained Novated Lease.
What can be included
If the vehicle is being registered at the time you buy it, or if vehicle registration fees are due within three months of buying the car, they can generally be included in the loan amount.
Stamp duty and government fees
Stamp duty is a state-government tax that is payable on the purchase of motor vehicles and can typically be included in your loan amount.
Rates of stamp duty differ from state to state, check out what you can expect to pay:
Negative equity from a previous car loan
Negative equity occurs if the market value of your vehicle falls below the outstanding amount of a loan used to pay for it.
For example, you bought a car for $30,000 three years ago, and now it's worth $15,000 but you still owe $18,000 on it - you have $3,000 negative equity you need to cover.
There are finance products available that can help get you into your next car and cover the negative equity from your old vehicle. However, the ability to include negative equity in your car loan will depend on the amount outstanding and your financial situation, and you need to purchase your car from a car dealership.
If you have negative equity, it pays to speak with a stratton consultant. We are experts at helping people deal with a negative equity situation - including how to avoid it on your next car!
Most common insurances can be included in the finance for your new car.
Compulsory Third Party (CTP) Insurance
CTP insurance is a legal requirement for all drivers, and is used to cover any medical expenses incurred by people who have been injured by non-insured drivers, or drivers who are unable to pay these expenses.
As most CTP premiums are included in the car registration fees, when you include registration in your finance, CTP will also be included.
Customer Credit Insurance (CCI)
If an unforeseen life event means you're not able to make repayments on your loan, CCI helps protect you from the unexpected by offering a range of cover options including life cover, trauma cover, disability cover and involuntary unemployment cover.
Comprehensive Car Insurance
Comprehensive car insurance covers damage, loss or theft to your vehicle as well as damage to another vehicle.
GAP Insurance (also known as Motor Equity Insurance) protects against a shortfall that may occur in the event that your vehicle is written off, and your vehicle insurance payout does not cover the balance outstanding on your loan.
So there's a scheduled service due a month after you'll take ownership of the car. If you're thinking about the resale value of your car, it can be worth keeping the log book up to date!
If you opt for a standard car loan, scheduled services can't be included in the loan amount.
If you are worried about the ongoing running costs of your car, you may like to consider a Fully Maintained Novated Lease.
Sometimes, our customers find better deals on cars interstate. For example, with the slow-down of the mining boom in Western Australia, there are some cars in that state priced well below the national average. In fact, some of our customers on the East Coast have bought cars from Western Australia, paid to transport them back, and still paid less than they would have if they bought the car locally.
Whilst stratton can finance a car purchased from interstate, whether or not transportation costs can be included in your loan amount is evaluated on a case-by-case basis. Check with your consultant to find out what we can do in your situation.
You typically cannot finance more than one asset (e.g. a car and a motorbike) using one secured loan. You can, however, apply for two (or more) loans at the same time, in which case some lenders will provide multi-loan discounts.
In a nutshell
Whether you want to finance some of your on-road costs (such as registration and stamp duty), or you're dealing with a tricky negative equity situation, talk to your stratton consultant for a quote on financing your next car.
To find out what is available for you, call 1300 STRATTON (787 288).
This information is for general use and may vary in different situations. Any loan request is subject to assessment and approval against normal lending criteria. To find out what applies to you speak to a finance consultant directly by phoning 1300 STRATTON (787 288).