When you’re in the business of hauling heavy-duty plant and equipment, you need a truck to match. That’s where a cashflow-positive, tax-effective truck finance deal through Savvy can help you out.
Whether you’re looking to buy one for your small business or lease a fleet for your larger-scale operation, we’ll compare your options among our wide panel of partners and connect your business with the most suitable deal for your needs. Get a free, no-obligation quote today!
Why apply for a business loan with Savvy?
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What are my truck finance options?
When it comes to financing your truck, there are several options to choose from. These include:
Chattel mortgage
These are a type of secured loan for the purchase of a truck, with the truck itself serving as collateral. Under a chattel mortgage, you’ll own the truck from the start of your term, which you can then repay with fees and interest over between one and seven years.
The loan is only designed to be used for the truck itself, rather than any other business expenses. You may be able to borrow up to 100% of the purchase price of the truck, though some lenders will allow you to include on-road costs like insurance, registration and stamp duty.
Deposits of between 10% and 20% are mandatory in certain situations, such as if you aren’t a property owner, while residual payments are optional.
Finance lease
Alternatively, if you don’t wish to buy the truck outright, you can opt for a finance lease instead. With this agreement, you’ll essentially rent your truck for a set term of one to five years with interest and fees. These can either be fully-maintained (inclusive of on-road costs) or non-maintained (on-road costs excluded).
At the end of your term, you’ll have to pay a residual. Your options for dealing with this are:
- Pay the residual and buy the truck to end your lease
- Sell or trade in the truck to cover the residual and either end your lease or start a new one
- Refinance the residual and extend your current truck lease
Operating lease
The big difference between finance and operating leases is that they come without a residual, meaning you’ll simply return the truck to your leasing company at the end of the term. This option is the most common with companies dealing with fleets of trucks that want to turn them over on a more regular basis.
Like finance leases, these can be fully-maintained or non-maintained, with the latter option also being common for larger-scale operations due to the amount of time saved on admin.
Unsecured business loan
If the truck you want to buy is too old, in poor condition or doesn’t meet the other key criteria, you may have to settle for an unsecured business loan. Unlike other forms of asset finance, these don’t require any collateral, making them more widely accessible to businesses of all shapes and sizes.
These loans are among the quickest to process, with funds able to be turned around as soon as the same day in some cases and used however you like, not just for your truck. However, the interest and fees you’ll pay are higher than secured finance.
How do I compare truck finance deals?
There’s plenty to consider when comparing your options. Here’s what you should be thinking about before financing your truck:
- Consider your business’ needs: if you want to own your asset from the start, a loan will be the best option for you. However, for businesses looking to refresh their trucks every few years, leases are more suitable.
- Look at the interest and fees: one of the easiest ways to compare is to consider how much you’ll be paying in interest and fees. Even small differences can save hundreds, if not more, across your term.
- Make sure your business and truck are eligible: of course, there’s no use applying for something you won’t be approved for. Take the time to read through the eligibility criteria (which your Savvy consultant will do for you).
- Check available terms and borrowing limits: where possible, you should always look for a term over which your business can comfortably manage your repayments. If you’re looking for a loan, any minimum and maximum limits should also be considered.
When you apply with Savvy, we’ll handle the comparisons for you and help you find the best available offer from our panel of trusted partners.
What types of truck can I finance?
You’ll be able to buy or lease a wide range of trucks, both new and used and from dealerships, auctions or private sellers. These can include:
- Cab chassis
- Cement mixers
- Crane trucks
- Dump trucks
- Food trucks
- Prime movers
- Rigid trucks
- Semi-trailers
- Tow trucks
This is just a small selection of what you might be able to finance, so you can speak with one of our experienced consultants to find out more about what your options are for the truck (or trucks) you have your eye on.
What are the tax benefits of truck finance?
The tax benefits you can take advantage of as a business will depend on the type of finance you decide to go with. Here’s a rough breakdown of what you may be able to claim under each finance option:
Chattel mortgages and business loans
- Interest on the loan
- GST on the purchase of the truck
- On-road costs like insurance premiums, registration and servicing
- Depreciation of the truck
Finance and operating leases
- Truck lease payments
- On-road costs like insurance premiums, registration and servicing
- GST on the purchase of the truck (claimed by your leasing company)
- Depreciation of the truck (claimed by your leasing company)
As you can see, leases allow you to claim up to the full payment, while loans allow the interest to be claimed. However, you must only claim up to the business portion of your truck’s use.
If you use the truck to get around outside of commercial usage 5% of the time, for example, you must take this into account and only claim up to 95% of the eligible costs. Speak with your accountant or tax professional to understand what your business can and can’t claim.
How much can I borrow with a truck loan?
As mentioned, you may be able to borrow up to 100% or more of the purchase price of your truck with a loan. However, the maximum amount your business can be approved for will depend on a variety of factors, including:
- Whether your loan is secured or unsecured
- The value of your truck
- Your business’ turnover
- Your business’ assets and liabilities
- Your business’ credit score (and your personal credit score)
- Your business’ record repaying similar loans in the past
When you get a free quote through Savvy, we’ll take a look at your business and personal profiles and run them by our lender panel to see how much we can help you get approved for.
Types of business finance
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How to apply for a commercial loan with Savvy
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Tell us about yourself and what you want to buy
First of all, fill out our simple online application form. This will tell us details like what you want to buy, how much you need and your business’ structure, revenue and trading time.
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Send through any required documentation
We may require further information in some cases to verify parts of your application. If this is the case, we’ll ask you to submit additional documents via our online portal.
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Discuss your next steps with a Savvy consultant
Once we get all the info we need, we’ll get to work comparing options from our lender panel. A member of our consultant team will give you a call to talk about your options.
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Have your application submitted for formal approval
After you give us the all-clear, we’ll get to work preparing your application to submit to your lender. This can be formally approved as soon as within 24 hours.
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Sign your contract and settle the deal
Once you receive approval, you’ll be sent all the required contracts and forms you’ll need to sign, which can be done electronically. We’ll handle settlement and the asset can be yours before you know it!
Commercial loan eligibility and documentation
Eligibility
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Age
You must be at least 18 years of age
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Residency
You must be an Australian citizen or permanent resident (or, in some cases, an eligible visa holder)
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ABN registration
Have an ABN registered in your name (available from as soon as one day after registration)
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Usage
Meet commercial asset usage requirements (at least 51% of total usage)
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Credit score
You must meet your lender’s minimum personal and business credit score requirements
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Commercial asset
The asset you choose to buy must meet your lender’s requirements in relation to its type, age and condition
Documents
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Personal information
Such as your full name, date of birth, address and contact details
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Driver's licence
Front and back (or another form of government-issued ID)
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Assets and liabilities
Information about your business’ assets and liabilities, as well as those in your name
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Asset details
Information about your asset, including its model and age, is worthwhile having on hand
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Business statements
Business Activity Statements (BAS) and business bank statements may be requested, but not always
