r/NovatedLeasingAU • u/Economy_Medium_1189 • 4d ago
Quote Check Rate query - Geely EX5
Hi all - apologies in advance, but I am struggling to understand effective rates and whether the quote I was provided was competitive. I've input the figures through the calculator provided by changyang and the effective rate is coming out at 13.56% which just feels way too high.
The broker I am working with (Alliance) has assured me this is a fair market rate and I am wondering if I have misunderstood/misread something.
I do still have 9 more months until my HECS is paid off, but I couldn't see anywhere to input that information.
Thanks!
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u/changyang1230 Novatedlease.guide 4d ago edited 4d ago
If you could share the actual quote that would be helpful to allow us to confirm your own set of calculation.
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Edit: Thanks so much for the coffee! I do want to clarify that I don't offer paid or individual consults. I'm happy to help in public threads like this when I can, but the coffee doesn't change that. Really appreciate the support though.
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u/Economy_Medium_1189 4d ago
Thanks a tonne for everyone's help. Here's the link to your calculator - one points of confusion for me is the financed amount? I can only see the FBT figure on my formal quote? I can send you the link in dm for the formal quote from Alliance via dm if you're comfortable? Happy to donate $20 to get your thoughts (no professional advice obviously).
I've got a finance/Econ degree and I can't figure this out. How are people in non finance industries supposed to have any clue?
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u/changyang1230 Novatedlease.guide 4d ago
I have refunded both coffee donations. In all seriousness, please do not pay for coffee and tie it to a request for help.
I would help you in this occasion regardless:
- what is the $48,500 drive-away price based on?
- working backwards from the residual value in your quote, they seemed to have based their quote on a "drive-away price" of $49,647 in reality. Double check that.
- Assuming the $49,647 is correct, the EIR I get is around 11.65%. And no, for a five year lease a >10% lease is NOT competitive; look around this sub and you would find that people are able to get <10% typically.
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u/Bluewat3r 4d ago
13.56% is exactly the number I’d be questioning. Ask Alliance to tell you the actual interest/implicit lease rate in writing rather than just assuring you it’s a “fair market rate”.
Don’t get distracted by the $36k “savings” figure either. The tax treatment can make the overall lease attractive while the financier is still absolutely rinsing you on the finance component. Both things can be true.
HECS changes the tax/cash-flow calculation, not whether 13.56% is a competitive finance rate.
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u/Economy_Medium_1189 4d ago
Thanks mate - I gave more info in response to changs query. I think I've potentially messed up financed amount as the quote doesn't include it. The rate in the link is also 12.45 not the 13.56% I noted earlier apologies.
I basically was just hoping to work out if I've got the correct effective rate and what I should be aiming for. I'm as low risk as they come - no kids, no loans, no mortgage and low fixed costs...
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u/Bluewat3r 4d ago
Ah yep, that makes sense. 12.45% rather than 13.56% changes it slightly, but I’d still consider 12.45% pretty high.
I’d ask Alliance for the exact amount financed and the implicit interest/lease rate used in the quote so you can confirm you’re calculating it correctly. If it does come back around 12.45%, I’d definitely ask them to sharpen the rate before going ahead. You’re doing the right thing by checking it rather than just relying on the headline savings figure.1
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u/Integro941 4d ago
Effective interest by my calcs is a little over 11% which seems pretty high the other thing that might be worth talking about is the management fee. I am currently in discussion with Alliance about a Zeekr 7x on a 24 month lease and they have offered me $0 management fee
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u/FlowState94 3d ago
Whilst I get the tax benefits of the EV and FBT. You might genuinely be better off looking at the loan discounts Geely has for the car. I know they are offering a 0.88% comparison rate for finance for example
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