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  • Profile photo of cambo82cambo82
    Participant
    @cambo82
    Join Date: 2003
    Post Count: 4

    Hi all,

    I am currently 21 and looking to purchase my first property soon. My problem is that I have a novated vehicle lease as part of my salary package, meaning that I effectively “Salary sacrifice” to pay for my car before income tax.

    My total salary package is around $50k including the car, however, the lease package incorporates all running costs of the car, such as insurance, fuel, tyres, etc. Now usually when applying for a mortgage you would only have to state what the repayments on the actual car were, not the entire running costs… correct? So my question basically is… Will this affect my borrowing capacity? Do I simply show the bank how the structure of the lease works and let them work it out?

    Just thought somebody on this forum may have been in a similar situation before. Any help much appreciated!

    Cheers
    Cameron

    …………………
    The dictionary is the only place where success comes before work.

    Profile photo of TerrywTerryw
    Participant
    @terryw
    Join Date: 2001
    Post Count: 16,173

    I beleive that you would not have to show the lease payments as a liability on your application as the cost is passed to the company. How does your salary appear on your payslips and group certificate. This would be the income you show.

    Some banks take into account employer provided cars, and adjust your living expenses downwards to take this into account. eg ING allow $3500 (annual) on top of your income if you have a company car.

    Terryw
    Discover Home Loans
    North Sydney
    [email protected]

    Terryw | Structuring Lawyers / Loan Structuring Pty Ltd
    http://propertytaxbook.com.au/
    Email Me

    Lawyer, Mortgage Broker and Tax Advisor (Aust wide) http://propertytaxbook.com.au/

    Profile photo of cambo82cambo82
    Participant
    @cambo82
    Join Date: 2003
    Post Count: 4

    Thanks for the advice. I went to a mortgage broker this afternoon and ran my figures by him. He is going to get back to me with an answer soon. :)

    I pretty much figured what you said would be the case… My payslips show the amount after the lease payments are made.

    Cheers
    Cam

    …………………
    The dictionary is the only place where success comes before work.

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