Team-BHP - View Single Post - ARTICLE: Lease OR Loan? Which EMI is better for you

condor · 28th May 2008, 07:49

The leasing looks to be a good option for business owners. For employees of companies that offer CLC's, it is a little risky.

Employee pays registration & other charges to get car on road.
Ex-Showroom price is paid by company (through financer, eg Citi)
MOnthly EMI to employe - about 2800 per Lac for 3 yrs or 2400 per lac for 4 yrs
End of lease period, employee pays 25% or 20% as residual value (Companies have increased the residual value from 10% recently)
Registration charges, insurance, fuel & maintenance expenses (upto a limit) can be pre-tax for employee.
Some more transfer fees & taxes.
EMI is pre-tax.
Empoyee pays FBT & lease tax (?)
Intrest works out out to about 13-14%.

Catch is if employee moves during the period of the lease. The employee then ends up shelling out much more than what he would have if he had not fore-closed the lease.

28th May 2008, 07:49	#16 (permalink)
condor Distinguished - BHPian Join Date: Jun 2006 Location: BLR : the Speed Breaker City Posts: 3,404	The leasing looks to be a good option for business owners. For employees of companies that offer CLC's, it is a little risky. Employee pays registration & other charges to get car on road. Ex-Showroom price is paid by company (through financer, eg Citi) MOnthly EMI to employe - about 2800 per Lac for 3 yrs or 2400 per lac for 4 yrs End of lease period, employee pays 25% or 20% as residual value (Companies have increased the residual value from 10% recently) Registration charges, insurance, fuel & maintenance expenses (upto a limit) can be pre-tax for employee. Some more transfer fees & taxes. EMI is pre-tax. Empoyee pays FBT & lease tax (?) Intrest works out out to about 13-14%. Catch is if employee moves during the period of the lease. The employee then ends up shelling out much more than what he would have if he had not fore-closed the lease. __________________ Life is Analog. Digital is an approximation.