The car that ate Matthew Carroll’s wage: How a Falcon lease was a noose around his neck

MATTHEW Carroll fell for a Falcon, worth $26,000, and had it purchased through his employer in the belief it would be cheaper. But ...

NICE car — but is it worth half a wage?

In 2012, Matthew Carroll fell for this Falcon, worth $26,000, and arranged to have it purchased through his employer in the belief it would be cheaper because the payments would come from his pre-tax earnings.

Under the “fully maintained” novated lease, five years’ worth of servicing, petrol, tyres, rego and insurance were rolled in.

FOLLOW JOHN ROLFE PUBLIC DEFENDER ON TWITTER

LIVE BLOG: BRYDENS LAWYERS ANSWER YOUR LEGAL QUESTIONS FROM 1PM

But the cost turned out to be $1727 a month, 50 per cent of the young real estate agent’s gross income before commissions.

Mr Carroll, 26, contacted me after reading the recent column on Aaron, a 21-year-old tradie extricated from a seven-year loan at 17 per cent that was set to cost him $65,000 for a $34,000 Holden ute. I convinced the ­dealer to let Aaron out of the deal. I did so by demonstrating he had been misled over the loan’s cost and terms.

Mr Carroll has not been misled in any way by the broker, Savvy Finance, or the lease provider, Macquarie.

So the best I could hope to do was to negotiate a more sustainable arrangement.

First, it’s worth understanding his current situation. The terms have changed at least twice, first to remove the cost of servicing, insurance and so on, and then when Mr Carroll changed employer, which meant payments could no longer come from this pre-tax income.

As of today, he’s making “crippling” lease payments of about $850 a month just for the car and faces doing so for the remaining three-and-a- half years of the five-year agreement. After that he would still need to fork over a “residual” of more than $4000 to own the car.

Under the deal Macquarie has put on the table, the lease would become a new five-year loan. By stripping out some of the extras and applying a super-competitive interest rate, repayments would drop to about $500/month — with no residual. Mr Carroll is considering this.

“We’ve got a result better than what we had in the first place. I can’t thank you enough,” he said.

AFTER deleting the Lane Cove dream home of the Bowring family and two other units, developer Arash Tavakoli got the green light to construct 18 extra units on the site.

Property developer Arash Tavakoli.

Documents lodged with Lane Cove Council show the Mindarie complex was originally a 60-unit development. But after modifications that saw the Bowrings’ bit of paradise replaced with a parking lot, the development increased to 78 units.

The Bowrings gave a development company owned by Mr Tavakoli a $37,500 deposit on a three-bed ground-floor unit almost two years ago. But he didn’t build it and didn’t tell them. They don’t think it reasonable to merely have their deposit returned with interest. Nor can they buy another unitbecause they say it’s several storeys up, unsafe for their two boys and $230,000 more.

Neither Mr Tavakoli nor his lawyers responded to requests for comment. Previously his lawyers said their client “denies Mr and Mrs Bowring’s account of events including the price differential quoted between the two apartments which is entirely inaccurate”.