Types of truck finance available in Australia

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Chattel Mortgage

A chattel mortgage is a type of finance typically used to purchase vehicles, such as commercial trucks. It involves the financier taking ownership of the vehicle until it is paid off, then transferring ownership to the borrower.

Chattel mortgages are beneficial for truck owners in Australia who need to acquire financing quickly and who have a clear payment plan with regular payments that can be made over an agreed term.

Repayment can be made over a period of one to seven years, and there is the option to use a deposit or borrow the full purchase price.

Finance Leasing

Finance leasing is a popular option for businesses looking to finance the acquisition of trucks in Australia. An operating lease is a financial arrangement between a financier and a business, where the financier owns the truck and leases it to the business for an agreed-upon time.

At the end of the lease, the business can choose to return the truck or purchase it from the financier at an agreed residual value. Payments are fully tax-deductible, and the cost of the lease is based on the GST-free value of the truck.

Terms for operating leases range from one to five years, and they provide a fully maintained version of a finance lease without the risks of asset disposal during the term.

Operating Lease

An operating lease is a type of finance option that allows businesses to use an asset without having to purchase it outright. This is commonly seen in heavy vehicle sectors such as truck finance in Australia, where a business may need to access and use a truck for its operations but does not have the capital necessary to purchase one outright.

With an operating lease, the business pays a rental fee on the truck and is responsible for its maintenance, but the financier retains ownership of the asset. Operating leases are typically offered over a period of one to five years and provide businesses with greater flexibility than a traditional loan or chattel mortgage.

Hire Purchase

Hire Purchase is a type of truck finance available in Australia which enables businesses to acquire new or used trucks without the need for an upfront payment. It is a form of loan that allows customers to pay off the purchase price plus interest over set intervals, usually in monthly instalments. This makes it easier for businesses to budget for and manage their cash flow.

Hire purchase agreements are typically long-term, allowing customers to spread payments over several years. The customer pays an initial deposit and then agrees to make regular payments until the agreement is complete and they have full ownership of the truck.

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If you need financing for a truck, Realloans is here to help. We offer competitive rates on finance for all types of vehicles, including trucks. Whether you’re looking to purchase a new or used truck, refinance an existing loan, we have the right solution to meet your needs.

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