Are you looking to purchase a truck for your business under a financing arrangement? If it's your first time financing a truck, you might be wondering how the process works exactly.
We've written this article to address all of your questions about truck financing. Read on to learn how the process works and the steps to take to secure financing.
What Is Truck Finance?
Truck financing allows you to borrow funds that will be used for the purchase of a new or used truck. Much like car finance or a home loan, repayments are made regularly until the loan has been fully paid off.
This allows truck buyers to spread the cost of their purchase over a period of 1-5 years. The lender will charge borrowers an interest rate.
Types Of Trucks You Can Finance
Truck loans can generally be used for most heavy vehicle purchases including:
- Prime movers
- Tipper trucks
- Cab chassis
- Service trucks
- Refrigerated trucks
- Pantech trucks
- Crane trucks
- Service body trucks
If you have any concern about whether a specific type of heavy vehicle is eligible for finance, it’s best to speak to a specialist truck finance broker.
Steps To Take
1. Determine Your Budget
Before applying for your truck loan, you should work out a budget. You can search the range of trucks for sale on Only Trucks to get a clearer idea of how much will be required for the purchase.
If you are intending to make a deposit on the truck, you can subtract this from the total purchase price to get the total amount you will need to finance.
When you have calculated the amount you would need to borrow, you can go to our truck finance repayment calculator. The calculator will provide you with an estimate of repayments based on the loan amount, interest rate and loan term.
Would your business be able to afford these repayments given your current financial obligations and cash flow? If the repayments are too high, you may need to consider a smaller loan amount or a lower priced vehicle.
2. Contact A Broker
A finance broker like Credit One will be able to assist you with your application for truck finance. It’s best to go to a brokerage that has specialist heavy vehicle finance brokers as they will better understand the industry and your requirements.
Brokers like Credit One have access to a large panel of lenders that they can organise your loan through. This means they will be able to match you with the lender that offers the best loan for your circumstances.
When you contact a broker, they will guide you through the entire process and provide you with a quote on your loan.
The broker will look at your circumstances to make sure you are eligible for financing. If you are eligible, they will collect the documentation required from you that is needed to submit your application to a lender.
3. Final Steps
Once you have received approval for your loan you can move forward with your truck purchase! If you have received a pre-approval, you can begin shopping for your truck, knowing how much you can spend on the truck.
If you have already chosen your truck, the lender will transfer the funds required to complete the purchase.
At the time of finance settlement, you will be provided with loan documents to sign. Once everything is finalised, the truck seller will receive the funds for the purchase and the truck is yours to drive away in!
Bank or Broker?
A common question among truck buyers is should you apply for finance through a broker or go directly through the bank?
We recommend applying through a broker for various reasons…
- A broker has access to multiple lenders so they can shop the market to get you a better deal
- A specialist truck or heavy vehicle finance broker will have expert knowledge of the industry that you generally won’t get at the bank
- A broker will take care of a lot of the hard work for you, making the process easier and saving you time
- A good broker will provide an unparalleled customer service experience and go above and beyond for your business
- You can develop a relationship with your broker which will make things easier next time you’re purchasing a truck or another asset for your business
Ready To Get Started?
If you’re ready to get started on a application for truck finance, begin an online enquiry to discuss your financing requirements with a specialist broker.
You can submit an enquiry in just 60 seconds on Credit One’s Truck Loans Finance website. After submitting an enquiry a broker will contact you to discuss your application and answer any questions you have about the process.
Credit One is Australia’s top rated brokerage with over 1400 five star Google reviews, so rest assured you will be in good hands. Click here to begin your enquiry.