Finance Options Explained
Contract Purchase (Choices)
Choices is an innovative finance plan that puts you in the driver’s seat. It gives you the opportunity to drive a new vehicle model as often as you like. Put simply – the luxury of choice. With this unique finance plan, you get to choose an option that suits you best at the end of the agreement period.
You can:
• Make the final payment and take ownership of the vehicle;
• Trade the vehicle in for a new model;
• Extend the agreement period by spreading the cost of the final payment; or
• Simply return the vehicle with no further obligation.
How does choices work?
Choices is really simple. All you do is:
• Agree on how long you would like to drive the vehicle
• Determine whether you wish to pay a deposit**
• Anticipate how much mileage you’ll cover over the contract period
• Agree on a monthly payment
Benefits of Choices
• Reduced monthly payments
• Flexible end of agreement options:
Make the final payment and take ownership of the vehicle
Trade the vehicle in for a new model
Extend the agreement period by spreading the cost of the final payment
The final payment is agreed and Mercedes-Benz Financial Services carries the risk of final payment**
Return the vehicle with no further obligation
• Opportunity to drive a new vehicle more frequently
• VAT capitalised at outset of agreement
• Finance charges and depreciation are deductible from income tax
• Maximum tax benefit achieved
• Increased balance sheet asset value
**Subject to kilometre and condition clauses
Instalment Agreement
The Instalment Agreement is the traditional way of financing your vehicle of choice. There are no surprises, only predictable and regular monthly instalments.
As a potential customer, there is no mandatory minimum deposit. A deposit however may be required by our Credit Department. What you get out of the deal is a finance package where repayments are payable in regular monthly instalments over an agreed period.
Benefits of Instalment Agreement
Acquisition of vehicle
- Fixed or variable interest rates
- Repayments over an agreed period
- Tailor-made payment structures
- VAT capitalised at the outset of agreement
- Finance charges and depreciation are deductible from income tax (dependent on the customer profile)
Instalment Agreement with Balloon
Instalment Agreement with Balloon is a simple and effective way for acquiring a vehicle with lower monthly instalments, with a final payment that transfers ownership to you, the customer.
How does it work? A final payment is negotiated at the outset of the agreement, and the remaining cost, plus interest charges, is then repayable in regular or monthly repayments over an agreed period. When the final payment is made, ownership is transferred to the customer.
Benefits of Instalment Agreement with Balloon
- Lower monthly payments with a final payment – responsibility of buyer
- Acquisition of vehicle – after final instalment
- Fixed or variable interest rates
- Repayments over an agreed period
- Tailor-made payment structures
- VAT capitalised at the outset of agreement
- Finance charges and depreciation are deductible from income tax (dependent on the customer profile).
Lease
Lease a vehicle for an agreed period with the option of ownership. Tailor-made to suit the needs of the customer, this agreement allows you to lease the vehicle for an agreed period with the option of ownership. Alternatively, the lease may be extended at the end of the agreement period.
Benefits of Leasing
- Option to take ownership of the vehicle or extend the lease at the end of the agreement
- Lease payments are tax deductable
- VAT capitalised at the outset of the agreement
Operating Lease
This operating lease package is specially designed for the customer who would like to pay for the use of a vehicle, rather than ownership. After estimating your anticipated mileage, your vehicle is rented to you for an agreed period. At the end of the rental period, the vehicle is simply returned, removing the worry of disposal, and the risk of ownership remains with Mercedes-Benz Financial Services throughout.
Benefits of Operating Lease
- Use of vehicle with option to buy
- Capital expense eliminated and improved cash flow
- Rental fully tax deductable as operating expenses (dependent on customer profile)
- Asset not reflected on the Balance Sheet
- VAT claimable and payable monthly (not capitalised up front)
- No vehicle disposal risk
- Only pay for use of vehicle
- Option to drive a new vehicle more often
- Reduced monthly payment