Finance – Trucks & Heavy Equipment

Securing Great Finance for Trucks & Heavy Equipment

If someone is telling you they got a great deal on their recent vehicle purchase, how do you know they’re not just foxing? If their claims are based totally on how they successfully bargained the price down, then they’re likely not telling the whole story.

Why? Because no truck or heavy equipment purchase can be hailed as ‘a great deal’ unless it is matched with a great finance deal. There’s little to be gained if you bargain a few dollars off the purchase price only to sign up to a highly-priced finance deal which you’re stuck with for up to say 7 years.

The really smart operators look to achieving the cheapest finance deal as a priority.

Finance Options

Securing the most cost-effective finance deal for your vehicle starts with choosing which product best suits your business. The options include:-

  • Chattel Mortgage
  • Leasing
  • Commercial Hire Purchase (CHP)
  • Rental or Rent to Own

The differences across the selection are in their suitability to different accounting methods, treatment of GST, tax deduction, balance sheet entries and the ownership of the vehicle during the loan term. You should discuss the options with your accountant to make an informed decision.

Structuring Your Loan

Once you’ve selected the best finance product, next step is to structure the loan to suit your business. This involves achieving a monthly repayment that suits your cash flow and a loan term that will work positively towards achieving your long term financial objectives. And most importantly you want the loan based on the cheapest interest rates available.

To achieve the loan structure that works for you, you should be working with a lender that is in a position to provide you with the finance flexibility that you need to support your business.

Unfortunately, not all banks and finance companies are prepared to offer businesses such flexibility when businesses approach them directly for finance. An alternative which many operators utilise is the services of a finance broker.

A finance broker is an independent operator who is licensed and while not aligned to any bank or finance company, has access through industry accreditation, with many lenders. A broker is usually in a better position to negotiate terms for their clients and has the bargaining power of the amount of business they write with that lender to bargain down the interest rate.

When selecting a broker, ensure they specialise in truck and heavy equipment finance so you know they will have access to the best lenders for your sector. The broker will handle your finance and have it structured to suit your objectives, as far as possible.

Definitely an option worth considering if you’re serious about securing the best vehicle finance deal.

If you’re interested in talking finance, we know people who operate in the financial services sector and have experience in truck and heavy equipment loans. We can easily connect you with them. Just contact us for details.