3 tips to make truck finance work for you

Last updated on February 18th, 2021
  Written by 
Bill Tsouvalas
Bill Tsouvalas is the managing director and a key company spokesperson at Savvy. As a personal finance expert, he often shares his insights on a range of topics, being featured on leading news outlets including News Corp publications such as the Daily Telegraph and Herald Sun, Fairfax Media publications such as the Australian Financial Review, the Seven Network and more. Bill has over 15 years of experience working in the finance industry and founded Savvy in 2010 with a vision to provide affordable and accessible finance options to all Australians. He has built Savvy from a small asset finance brokerage into a financial comparison website which now attracts close to 2 million Aussies per year and was included in the BRW’s Fast 100 in 2015 as one of the fastest-growing companies in the country. He’s passionate about helping Australians make financially savvy decisions and reviews content across the brand to ensure its accuracy. You can follow Bill on LinkedIn.
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Truck finance tips

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Get to know what finance options are out there

Carefully considering ways in which to finance your truck business is vital. It also helps to know what options are available to you. Leasing a truck can be financially viable for truck businesses that are looking for a finance option that allows them to constantly upgrade their trucks without affecting their cash flow. It also means that you can keep the cost of maintenance and repairs off your books.

There are generally two products for business owners who are looking to purchase their trucks outright. Chattel mortgage is a loan that you can use to purchase a truck. It comes with potential tax benefits such as being able to claim GST, interest on payments, and the fuel input tax credit. Then you have hire purchase is almost similar to chattel mortgage. The only difference is that your lender owns the vehicle until you have paid off the vehicle. Check to see which ones will let you own the truck outright and which ones won't. Remember to compare loan features to find one that will offer you the flexibility that will be suitable for your finances.

Find finance that works with your business needs

Australian businesses borrowed $43,928 million in commercial loans. Keeping your truck in mint condition is important for most businesses. 87% of business owners also look at the cost of maintenance of a truck before purchasing it. However, it is imperative to ask yourself important questions such as:

  • Whether you are planning on expanding
  • What loan term will be suitable to adequately cover your expenses
  • Are you operating seasonally?
  • How often will you need to replace your truck?
  • Will you need the flexibility to keep up with the latest truck?

This can help you narrow down your search for financing that will help you meet your business's needs without overextending your budget.

Financial flexibility

Checking your finance option for flexibility can ensure that you don’t bite off more than you can chew. This means comparing financing that will be able to help you maximise your cash flow. Features such as being able to trade in your truck at the end of a lease can come in handy for some businesses, while other options offer you appetising tax benefits for your business. The payment plan on your loan is also important. Speaking to a financier can help you find a loan that is tailor-made to fit your needs. This can definitely be a suitable feature for businesses that operate seasonally.

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This guide provides general information and does not consider your individual needs, finances or objectives. We do not make any recommendation or suggestion about which product is best for you based on your specific situation and we do not compare all companies in the market, or all products offered by all companies. It’s always important to consider whether professional financial, legal or taxation advice is appropriate for you before choosing or purchasing a financial product.

The content on our website is produced by experts in the field of finance and reviewed as part of our editorial guidelines. We endeavour to keep all information across our site updated with accurate information.

Approval for commercial loans is always subject to our lender’s terms, conditions and qualification criteria. Lenders will undertake a credit check in line with responsible lending obligations to help determine whether you’re in a position to take on the loan you’re applying for.

The interest rate, comparison rate, fees and monthly repayments will depend on factors specific to your profile, such as your financial situation, as well as others, such as the loan’s size and your chosen repayment term. Costs such as broker fees, redraw fees or early repayment fees, and cost savings such as fee waivers, aren’t included in the comparison rate but may influence the cost of the loan. Different terms, fees or other loan amounts may result in a different comparison rate.

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