Having full use of a heavy vehicle without the weight of the asset appearing on the balance sheet can be an attractive benefit for many operators.
The interest rates on commercial credit facilities vary with the different options and, also across the lender market. With our extensive lender base of more than 80 lenders, we have the resources and the expertise to secure the best rates on the market. Rates on this off-balance sheet option are marginally higher than Chattel Mortgage, making this a very cost-effective option to consider.
Rates will also vary based on individual applications. Use our latest rates to compare rates and repayments on the different heavy vehicle funding facilities and request a quote by phone or online for your individually sourced rate.
This funding facility is not a rental or hiring agreement, it is a credit product for the acquisition of heavy vehicles and other commercial assets.
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The attraction for many enterprises to this credit option is that the asset, the vehicle, is not posted to enterprise’s accounts or balance sheet as an asset. Why? Because the lender purchases the vehicle and the vehicle is leased to the buyer. As the buyer does not have title ownership of the vehicle, it is not posted to their balance sheet. Hence the off-balance sheet description.
The buyer does have full operational use of the vehicle over the repayment term and is responsible for all operational expenses. When all monthly payments and residual are finalised, ownership is transferred from lender to buyer. Providing many operators with a flexible credit option for acquiring new and second-hand vehicles.
The tax benefits are straightforward with the monthly payments fully deductible. GST is applied to the monthly payments and claimed on the appropriate BAS return.
Deciding if this option is appropriate for your operation may depend on the accounting method used by the enterprise. This credit option is suited to the accruals accounting method. We recommend operators have a discussion with their accountant or CFO to confirm if this is the most suitable and workable option for their set-up.
Despite the balance sheet benefit, the funding still has to be cost-effective for the operation. An objective we provide with our low interest rates and expertly sourced and negotiated vehicle credit solutions.
We individually source and negotiate all funding and secure the lowest fixed rates over a fixed term with a fixed repayment schedule that works with cash flow.
Buyers can quickly convert our current interest rates into repayment estimates on the vehicle they are considering with our credit calculator. No special skill is required, no special apps or downloads. Use the calculator directly on our website to calculate funding estimates on any type of heavy vehicle purchase. Vary the values entered to establish a clear idea of the amount, term and residual that delivers the monthly commitment to work with your cash flow. For a confirmed quote, give us a quick call!
Our guides offer quick comparisons and simple explainers to help you cruise through the financing process with confidence.
Utilising our expert and highly experienced brokers provides operators with the opportunity to cut through the vast lending market to quickly find the best rates and funding terms that suit their specific operation. We are accredited with more than 80 lenders which include the main banks as well as specialist non-bank lenders in heavy vehicle funding.
With our expertise and smart tech systems, we have the capabilities to quickly find the lender that is best placed to make the most workable offer based on a customer’s requirements. We handle all the negotiations and discussions to save our customers time and a lot of trouble in finding the best credit option.
We work with all sized operators from the corporate fleet carriers through to sole owner-drivers, offering Low Doc and No Doc options for new operators. Contact us to get started.
Operators in all areas of Australia, even the most remote locations, can access our services by phone and through our online systems. Carriers of all types of payloads, acquiring new and used heavy vehicles, through all cities and regions can contact our Australian-based brokers to have their funding requirements expertly handled.
Apply today – online or by phone, for quick quotes and fast approvals. Our brokers will assist you with the application process to simplify and streamline the credit sourcing process. If attending an auction to buy, take advantage of our pre-approved application process for confident bidding.
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THE INTEREST RATE IS CALCULATED ON A SECURED LOAN PREDOMINATELY FOR BUSINESS USE, EFFECTIVE 16/09/2024 AND SUBJECT TO CHANGE. WARNING: THE INTEREST RATE IS TRUE ONLY FOR THE EXAMPLES GIVEN AND MAY NOT INCLUDE ALL FEES AND CHARGES. DIFFERENT TERMS, FEES OR OTHER LOAN AMOUNTS MAY RESULT IN A DIFFERENT INTEREST RATE.
Ownership of the vehicle is transferred to the buying operator when all monthly payments and the residual are finalised.
With an off-balance sheet facility, the monthly payments are treated as an operating expense and are deductible. The deduction for the residual is per ATO guidelines.
With an off-balance sheet credit facility, GST is charged on the scheduled payments. Operators registered for GST can claim the amount on the relevant BAS return.
Rates on this credit facility are highly competitive and typically slightly higher than Chattel Mortgage and CHP and lower than Rent-to-Own.
Off-balance sheet means that the heavy vehicle is not posted to the accounts/balance sheet of the borrowing enterprise as the ownership is held by the lender. When all payments are finalised, ownership transfers to the borrowing enterprise and as such to their balance sheet.
All types of heavy vehicles may be funded with the full portfolio of commercial lending facilities. The best option should be selected by the operator based on suitability to their accounting method, tax strategy and approach to their balance sheet.
Yes. Buyers can use an online resource, a credit calculator, to compare estimates on all types of credit products. Calculators are readily available on broker and lender websites.
To be eligible for all types of commercial credit, enterprises must hold an ABN. A range of financials will be requested. These include bank statements, tax returns, accounts, BAS and other documentation to show the position of the enterprise. Being GST registered is preferred but not compulsory.
Credit calculators do not include charges by lenders and do not have the functionality to discern between the credit profiles of users. They produce estimates based on raw values only. Any offer that is made by a lender can be different from the calculator result.
The same credit products can be selected for both used and new heavy vehicles. Interest rates, terms and credit conditions can vary for older vehicles as their age and condition is taken into consideration when lenders prepare offers.
The residual is a percentage of the loan amount that is due for finalising after the monthly commitments are finalised.
The term approved will subject to individual decisions by lenders. Terms of around 7 years are typical.
