We understand that securing trucks can be critical to your operations and revenue.
Amfin will make financing your trucks easy. Whether it be your first purchase, an expansion of your existing fleet or a whole new fleet, we are here to find the best arrangement for your individual needs.
How does Truck Finance Work?
A commercial truck loan is a type of financing designed for the trucking industry. It can be used to finance everything from a delivery truck, a dump truck or a fleet of semi-trucks.
Amfin will help your business secure a loan for the amount you require and for a loan term of up to 5 years. We will also help you structure the loan in a way that suits you by looking at different deposit, repayment and balloon options.
Types of Commercial Truck Finance:
NEW VEHICLE LOANS:
Business loans for new trucks can be secured for you quite quickly. A new truck loan is secured by the value of the vehicle and can be competitive due to the age of the asset being low risk.
USED VEHICLE LOANS:
A used truck loans are also secured by the value of the vehicle and is easy for us to obtain for you. There are a few more things involved when assessing the value of the truck, risk involved and right lender for you. Our qualified team will be able to navigate this process for you to ensure we find the best solution for your business.
Does Commercial Truck Finance have balloon payments options?
Commercial truck loans generally have balloon payment options at the end of the term. There are a few different options available to your business once the balloon term is due.
Your business might choose to have a balloon payment to keep monthly repayments low for cash flow purposes. The higher the balloon payment, the lower the monthly repayments will be in exchange for owing the lender a lump sum at the end of the loan term. Using a balloon payment option can help a business purchase a more expensive vehicle whilst keeping affordable monthly repayments.
What happens at the end of term?
At the end of term, if a balloon payment is due, your business will have a few available options, depending on the lender and terms of your agreement.
In general, your business may be able to do the following:
- Trade the vehicle in and purchase another with a new finance arrangement, and in the process repay the balloon amount.
- Repay the balloon with funds at hand or sell the vehicle separately
- Refinance the vehicle or balloon amount and retain the vehicle
What types of loans can be used for Commercial Truck Finance?
A chattel mortgage or equipment loan is a loan used to purchase an item of movable personal property such as a car, a piece of agriculture or construction equipment, a boat or a mobile home. The property, or chattel, secures the loan and the lender holds ownership of the asset until it has been paid off.
To learn more about Chattel Mortgage click here.
COMMERCIAL HIRE PURCHASE:
A commercial hire purchase (CHP) involves a lender agreeing to purchase an asset (usually a vehicle) on behalf of the borrower and then hiring it back to the borrower over a set period of time. This means that the borrower is not legally the owner of the asset, however they have full use of it for the term of the contract.
To learn more about CHP click here.
Benefits of using Commercial Truck Finance for business owners:
- Asset ownership Status – . Once the application has been approved, you can enjoy full ownership status of the equipment.
- Financial reporting benefits – The equipment is listed on your Balance Sheet as an Asset.
- Tax benefits – As the owner of the equipment, you may be eligible to claim the GST component of the purchase against your tax when you lodge your BAS statement. Certain types of chattel mortgages may also allow you to claim depreciation and interest.
- Imperfect financial history – . Even with a less than perfect credit history, your application can still be accepted since the risk for the lender is reduced by securing the equipment against the loan.
- Low fees and interest rates – Chattel mortgages typically attract lower interest rates and fees than some alternative forms of finance, such as unsecured personal loans because the asset is secured by the lender.
- Flexible payment structure – You can choose to set up a balloon/lump sum payment at the end of the term to lower your monthly repayments. However, a large balloon payment will increase the amount of interest paid over the loan term.
Eligibility criteria for a Commercial Truck Loan?
Businesses, sole traders and self – employed individuals can all make use of commercial truck loans. To be eligible you will require the following:
- At least 18 years old
- An Australian resident
- Have a good credit rating and not be going through the process of bankruptcy
- Have a valid Australian Business Number (ABN)
- Is registered for Goods and Services Tax (GST)
Most lenders will also require that the business has been trading for more than 12 months, however the minimum length of trade varies between lenders.
How do I apply?
If you would like to know more or need assistance determining the best equipment financing solution for you, one of our experienced finance consultants are happy to assist, contact us today.
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