Commercial Vehicle Finance. The Right Structure for Your Business.

Commercial vehicle finance funds the vans, utes and light trucks a business runs, with the vehicle itself standing as security and the lender's interest recorded on the PPSR.

The structure is the first decision rather than an afterthought, because a chattel mortgage, a lease and a hire purchase each place ownership and the balance sheet treatment differently.

Terms run from one to seven years, and the application is assessed on the business as much as on the person signing it.

A work vehicle earns while it is being paid for, so matching the repayment to the revenue it generates keeps working capital where the business needs it.

Financing also keeps a replacement cycle predictable. A vehicle reaching the end of its useful life becomes a planned changeover rather than an unbudgeted expense.

Depending on the structure and how the vehicle is used, there may be GST and depreciation consequences. Your accountant should confirm what applies to your situation.

The test is how the vehicle is used, not what it looks like. A ute driven mainly for personal use may actually be better suited to consumer finance.

How long the business has been trading affects which lenders are available. Established businesses can access more of the panel, while newer ABNs are matched to lenders who assess them on their own terms.

If the vehicle needs a body, tray or fit-out, sort that out before you apply, so the finished vehicle is what gets financed rather than just the bare cab.

Start with the ABN, how long the business has traded and what the vehicle will do. Those three shape which lenders are worth approaching.

One enquiry compares lenders rather than lodging separately with each, which keeps enquiries off your file and the credit report intact.

Same day pre-approval is possible for straightforward applications, and your broker manages the supplier payment through to delivery.

Talk to your accountant about the right structure before you sign anything. It's much harder to undo the wrong choice later than to get it right from the start.

Match the loan term to how long you'll actually use the vehicle. You don't want to still be paying off a van you've already retired from the fleet.

Keep your business paperwork up to date. An outdated ABN or registration detail is the sort of thing that can slow down an otherwise straightforward application.