Written by Starting a business can be a catch-22 situation. It’s hard work – you can’t build a good business credit history without taking on some credit, and you can’t take on some credit without having a good business credit history.
Rent-to-own truck agreements offer a solution and give you the option to reassess your situation as you grow. You can opt to buy, return or extend the finance when that suits. Not only that, but each payment you make goes toward the purchase price if you do buy, so it’s less wasteful than renting.
Here at Savvy, we help Australian businesses navigate the tricky path to funding assets and vehicles. We aim to make affordable commercial finance available to as many Australian businesses as possible. We work with a range of rent-to-own truck lenders willing to work with borrowers from all backgrounds, so we can help you get on the road to success.
How do rent-to-own trucks work?
Rent to own trucks are relatively simple and easy to arrange. Your lender will purchase a truck and then rent it back to you, as per a signed agreement for a set period of time. You get exclusive use of the vehicle, just as you would with a more expensive traditional vehicle rental agreement. During that time, you’ll be responsible for any operating costs, maintenance, and servicing.
You pay a fixed amount each month for the duration of the rent to own agreement, and at the end of the term, you can either return the truck or negotiate to buy it. If you do opt to become the truck’s owner, each repayment you made during the rental agreement will have earned you some equity in the vehicle, so you’ll be paying less than if you bought the truck at the start.
In terms of tax, your monthly payments get classed as an operating expense throughout the rental term, so they’re fully tax-deductible. You pay GST on each rent to own payment, so you can claim them as you go along via your business activity statements.
What can I buy with rent-to-own truck finance?
Savvy partners with rent to own financiers that offer facilities to buy trucks either through dealers or private sellers, and you can even find plant, machinery, and vehicles on auction sites. It’s important not to be put off if your bank or regular finance provider has refused on the basis that an asset is too specialised – which can often occur with traditional lenders.
Savvy regularly helps transport and logistics clients source and finance a host of different vehicles, as well as farmers, contractors, and purveyors of all sorts of goods, including:
- Rent to Own Livestock Trucks
- Prime Mover Finance
- Rent to Own Refrigerated Trucks
- Tipper Truck Loans
- Livestock Trailer Finance
- Rent to Own Car Carriers
- Concrete Truck Loans
- Finance for Cranes
What are the benefits of using a broker like Savvy to find rent-to-own truck finance?
Our expert commercial finance consultants are highly skilled at identifying relevant financial products and matching them to specific businesses, sectors, and individual traders. No matter whether you’re running a huge fleet or you’re an owner-operator of a single vehicle, we can help. Our people have much experience working with real contractors, fleet managers, and sole traders in all parts of the logistics, warehousing, and transport industries in Sydney, Melbourne, Adelaide, Perth, Brisbane and all regional areas. They know the trucks, the finance options, and how to speed up and streamline the process around getting vehicle finance in place.
What that means for you is that you spend less time dealing with funding and more time making sure your business is profitable, and your contracts are fulfilled – and that extends to having the appropriate machines and vehicles in place to do a job. Savvy helps hundreds of transport companies and operators nationwide, and we’re with you from the moment you contact us to the minute your new truck gets delivered. We partner with more commercial finance providers, so you get increased competition and lower rates, no matter what type of finance and truck you need.
THE SAVVY DIFFERENCE
We've been helping Australians find the perfect deals for their needs for over a decade, so we know what goes into a good product.
Our focus is to help consumers like you make ‘Savvy' decisions by simplifying the complicated process of comparing and buying products.
By increasing the number of options in your comparison, you can make an informed choice on which deal is the cheapest for you.
We've been helping Australians find the perfect deals for their needs for over a decade, so we know what goes into a good product.
Our focus is to help consumers like you make ‘Savvy' decisions by simplifying the complicated process of comparing and buying products.
By increasing the number of options in your comparison, you can make an informed choice on which deal is the cheapest for you.
Pros and cons of a rent-to-own truck
Rent to own truck finance is cheaper than traditional short-term rental costs if you need a heavy vehicle for a relatively short contract or job.
Every time you make a rent to own repayment, you build equity in the truck (in the event that you go on and buy it).
Turnaround times to gain access to vehicles are relatively quick.
If you’re a new business and need to buy a large vehicle, rent to own truck lenders accept alternative documentation, compared to other forms of commercial loans.
Contracts tend to be set up in 12-month intervals. Compared to traditional asset finance, which usually runs for five years with no outs. This gives yo flexibility to decide whether to extend the finance, buy the equipment or return it.
Lenders generally charge more for rent-to-own agreements than the cost of the average chattel mortgage or finance lease.
Not all of your repayments go toward building equity in the truck. Typically, only a percentage of the payment reduces the purchase price.
If you don't end up buying the truck, the capital you've invested is gone.
If you miss a repayment your truck is likely to be repossessed immediately.
More of your rent-to-own truck questions
Generally, no. Lenders often have a customer profile form that you can fill in. Your Savvy finance consultant can help you get through the application process as quickly and easily as possible.
No. You do not have to have equity in commercial or residential property when it comes to renting to own.
That very much depends on your circumstances. If you’re not a new business and you’re just short on up-to-date financials – for example, if you haven’t filed a tax return recently or your accounts haven’t been updated for a while – you can talk to one of our consultants about low doc truck finance. That’s supplied by specialist lenders who accept different documentation from traditional commercial asset finance providers. If you had bad credit, there are some Bad credit truck finance options as well. It depends on the credit and business profile.
Within 24-48 hours after you have spoken with a consultant. Not only will they identify all the best solutions that suit your needs, but they’re also always on hand to help with queries.
You can. Deposits aren’t necessary for rent to own agreements.
You can. There aren’t really any limits to what assets and vehicles you can finance via a rent to own agreement.
Helpful guides on car loans
Get your car loan quote now
Explore a range of car finance options with Savvy. Get started with a free, no-obligation quote today!
