Leasing - good for financial health

If you wish to purchase a brand new or used vehicle, leasing will be the best option for purchasing the desired automobile – reasonably and on great terms. It is a chance to drive as new car or motorcycle as possible already today. However, it also entails responsibilities and regular payments. It is important for us that you feel comfortable with your monthly payments, which should not substantially affect your normal life. With your comfort in mind, we have developed various solutions that allow planning expenditures and spreading out monthly payments evenly over course of the year.

Together with car lease, Swedbank offers two great and easy-to-use supplementary services – Car Insurance and Statoil Fuel Cards. Moreover, our existing clients can also count on advantages such as better terms of leasing. This particularly applies to Swedbank’s leasing repeat customers.

Borrowing must be reasonable

Customers, who are already using the services of Swedbank, describe us as a reliable partner because the bank cares for its clients’ long-term comfort and financial safety. Our specialists are at your service to help find the best solutions that suit your particular requirements. Before taking out lease, Swedbank recommends clarifying how much money you are willing to invest monthly in maintenance of the car. The older the car, the bigger expenses on repairs. For new cars, in first years the repair expenses are much lower, plus dealerships normally provide warranty maintenance.

It is an extremely important factor that your income is steady in the coming years and that you know that the employer is paying social taxes for you. Thus, when borrowing for purchase of a car reasonably, it is worth selecting the kind of car that is appropriate for you because on the average lease payments make up only 40% of the car running costs. The rest of the expenses go into car maintenance. Moreover – the older the car, the more you’ll have to pay.

For a better illustration, let’s see some examples:

Car:	Mitsubishi Grandis	Honda Civic 5D	Toyota Land Cruiser	Opel Zafira
Specification:	2,4 AT, petrol engine, Intense	Petrol engine, Sport	Odometer reading - 31,400 km, 3-litre petrol engine	Odometer reading - 46,545 km, 1.6-litre petrol engine
Year:	New	New	2006	2006
Price, LVL:	18 624,31	12 830,00	23 122,25	10 411,34
Operating lease period:	5 years	5 years	5 years	5 years
Down payment:	15 %	15 %	15 %	15 %
Fixed interest rate:	8,70 %	8,70 %	8,70 %	8,70 %
Monthly lease payment, LVL:	264,10	181,93	327,89	147,63
Car Insurance, LVL:	55.71	34.80	113.89	35.11
Petrol, LVL (at the price of LVL 0.7 / l):	233,80	149,74	212,03	165,82
Maintenance, LVL:	32,94	29,03	50,77	12,50
TPL insurance, LVL:	12,00	11,06	19,05	12,50
Monthly total, LVL:	600,11	411,22	710,12	384,35

These examples imply that before you take out lease on a car, you should consider your family’s budget and carefully weigh all pros and cons.

Down payment on car purchase

You don’t always have spare funds available for a down payment when you wish to take out lease on a car. One can, of course, set some money aside, however you will always be tempted to spend it on new clothes, entertainment or other things. A very realistic option is to save the necessary amount through the Down Payment Savings Account. That will enable you to realize your plans within already half a year or two years. Each month, you’ll need to deposit to the savings account a fixed amount of money equivalent to that, which you’d have to pay for car lease on a monthly basis. That will discipline you in advance, help you plan monthly expenses and determine the most suitable size of monthly car lease payments. The money paid into the savings account will bear fixed interest (plus, more than regular savings accounts). Should you find your perfect car or have saved up for the down payment sooner than expected, the money saved and the interest earned can be used before the term of deposit runs out. The only condition is that you need to have a lease agreement signed with Swedbank.