Why EOFY is the best time to buy a vehicle

While the last two days of any month make for a good time to purchase a new vehicle, EOFY is prime time for new-car shopping.

With dealers motivated to meet annual targets and buyers hungry for a good bargain, prices are down, deals are generous and there’s more room for negotiation.

EOFY vehicle sales are a win-win for both buyers and dealers. But how can you get the most from them?

Tips for purchasing vehicles around EOFY

1. Don’t wait to snap it up

Don’t leave it too late to visit a dealer—especially if you have your eye on a particular vehicle model, colour or spec.

Not fussed on the details? You can afford to wait a little longer. In fact, keeping an open mind gives you access to serious bargains. That’s because dealers are looking to get rid of existing stock on the sales floor to make room for newer models.

2. Treat advertised deals as a starting point

An advertised deal, no matter how great, is likely a deal with meat on it. Remember, dealers are keen (sometimes even desperate) to get stock off their hands in the lead up to June 30.

Haggling can result in further discounts to the vehicle’s price or add-ons like tinted windows, alloy wheels, extended warranties and roadside assistance. You don’t know unless you ask!

3. Take advantage of the instant asset write off

Once you’ve purchased your vehicle, you can take advantage of tax perks like the Instant Asset Write Off. This initiative allows you to claim your vehicle and instantly depreciate its cost, saving you money in the long run by reducing your tax burden.

Should you take out finance for a new vehicle?

When purchasing a new vehicle, you have two options. You can use your own cash or take out finance. While there are pros and cons to both, we almost always recommend business owners take out finance.

First off, tapping into savings or eroding cash flow can put your business in a risky position. You never know what’s around the corner, and having cash to fall back on in emergencies or unexpected scenarios is essential for a healthy and stable business.

Secondly, using cash on hand can unnecessarily hinder growth. Instead of using existing funds to purchase your vehicle, you can invest that money with the intention of receiving returns greater than the interest you’re paying.

Alternatively, you can fund new projects and invest directly in the growth of your business. Often, this will generate a greater return than what you would have saved by avoiding taking out finance.

Types of vehicle financing

There are a few different types of vehicle financing you can choose from. Here’s a breakdown of how each one works:

Equipment loan

Also known as a chattel mortgage, an equipment loan is similar to a residential mortgage. Your lender will provide you with funding to purchase a business car. The lender will then use your new car as collateral—or security—in case you default on your loan.

If you fail to make repayments, your lender will be able to take the car from you, hence making you less of a risk in their eyes.

Hire-purchase agreement

A hire-purchase agreement involves your lender purchasing a car on your behalf for you to borrow. They’ll own the vehicle until you pay it off in full—in which case you’ll own it outright.

Hire-purchase agreements are typically flexible. Some lenders will let you put down a deposit to lower interest rates, while others may give you the ability to return the car during your repayment term if it’s no longer needed.

Lease agreement

A lease agreement is similar to renting out a property. Once you’ve paid off the value of your car you’ll typically return it, though some lenders will allow you to extend the lease or buy the car at its depreciated price.

The good thing about lease agreements is that often, your lender will be responsible for maintenance costs (similar to having bills included in rental payments). All you’ll have to worry about is making your repayments on time.

Should you take out finance before or after seeing a dealer?

It’s wise to organise finance before approaching a dealer for a couple of reasons. First, offering cash upfront can give you more negotiating power.

Second, dealers size up their customers early on in the sales process, so showing that you’re an experienced and serious buyer can help you take control of the negotiations process and ward off any attempts to exploit a lack of knowledge—both of which will help you land the best deal possible.

If you’re keen on snapping up a good deal but unsure where to start in terms of finance, we can lend a hand. Speak to a specialised lending expert on 1300 780 568 or use our online loan finder to compare rates on finance from over 80 leading lenders.

Our quotes are free and no-obligation, and a good place to start exploring vehicle finance.