Throughout the lifecycle of a business, there are pivotal moments when owners revaluate their financial needs. The current circumstances, including the start of a new financial year and the persistent impact of the ongoing COVID-19 situation, may prompt such reflection. The commencement of a new fiscal year presents an opportunity to assess the effectiveness of existing loan commitments. Businesses may have undergone growth or contraction over the past year(s), rendering the current loan arrangement unsuitable for future endeavours.
In cases where a business is entering a significant expansion phase, involving the acquisition of new vehicles to capitalize on emerging opportunities, it becomes crucial to take a holistic view of financial commitments. This comprehensive approach enables better alignment between the business's growth objectives and its financial structure.
Moreover, the ever-present factor of COVID-19 demands attention. Following a period of relative stability, with limited local transmissions and many businesses transitioning back to regular operations, a substantial outbreak has emerged in June 2021. Although not all cases are linked, this situation underscores the repeated warnings that the pandemic's impact might persist for an extended period. Businesses that have endured until now based on their existing financial setups may consider this an opportune moment to implement permanent adjustments to their truck financing arrangements.
Other permanent changes may involve a driver choosing to move to owner-operator, self-employed status with their own truck.
Truck finance is a major part of our business and our team of licensed finance professionals is well-equipped to assist both new and existing customers to refocus, reassess and restructure their truck loans. We offer a range of truck loan options and tailored solutions to suit individual needs. The solutions will vary depending on need but are all priced at our cheap interest rates.
Refinancing Existing Loan Arrangements
When businesses encounter shifts in their circumstances, one of the most widely adopted strategies is refinancing existing loan agreements. Truck loans, which can extend up to 7-year terms, offer the flexibility to accommodate various changes that may occur over such a timeframe. Notably, the interest rate landscape has undergone substantial shifts in recent years. Significantly, interest rates on loans have been markedly reduced during this period.
Comparing the interest rates applicable to loans secured today with those prevalent a few years ago reveals a notable difference. Loans procured in the present day are likely to carry substantially lower interest rates compared to loans secured a few years prior. This interest rate reduction translates into potential cost savings and improved affordability for businesses seeking to restructure their financial commitments.
Truck loan refinancing involves sourcing a completely new loan arrangement to replace the current loan. The new loan would cover all outstanding repayments, balloon/residual and the payout fees and costs involved in finalising the current loan. Refer to our article on truck finance payout and break fees as a reference. The standard fees would also apply to setting up the new loan so all these costs should be taken into account when considering refinancing.
A loan can be refinanced with a different financial product to the current loan. That could mean changing from Rent to Own to Leasing, or Leasing to Chattel Mortgage or any other variation. As you can see from our Truck Loan Interest Rate Table, the interest rates vary across the loan types. So refinancing at a cheaper interest rate loan may be of benefit to a business.
Furthermore, the truck refinancing process provides a platform for businesses to fine-tune their repayment structure to better suit their evolving needs. This could involve opting for either higher or lower monthly payments. In scenarios where a business is experiencing robust performance, selecting a higher repayment amount and thereby shortening the vehicle ownership duration might be advantageous. On the other hand, if economic challenges have affected the business, opting for lower monthly payments can help alleviate immediate cash flow pressures.
Irrespective of the specific objectives, your dedicated consultant will collaborate with you to thoroughly explore the available options. They will diligently source the most suitable and cost-effective refinancing solution that aligns with your unique circumstances and objectives.
Combining New Purchase with Existing Truck Loan
Expanding a business fleet to accommodate new opportunities often entails exploring various options to optimize operational efficiency. In this context, businesses can explore the possibility of consolidating multiple financing arrangements into a unified structure. This approach involves refinancing existing loans while simultaneously acquiring a new truck loan. The outcome is a single monthly repayment that covers all the financing commitments.
This streamlined approach can offer several benefits, including simplified accounting processes and enhanced visibility of financial commitments. By centralizing repayments, businesses can potentially improve cash flow management and gain a clearer understanding of their overall financial obligations.
When considering this route, collaborating with your consultant is pivotal. They will guide you through the process, analyse your unique requirements, and tailor a solution that aligns with your business objectives.
Options Moving Forward with New Truck Finance
If the reassessment process identifies the need for new or additional trucks for the business, there is a range of truck loan products available to finance the acquisitions:-
- Truck Leasing
- Truck Rent to Own
- Chattel Mortgage or Heavy Equipment Loan
- Commercial Hire Purchase or Hire Purchase
Each of these loan types encompasses tax-deductible components, though they diverge in their handling of GST, compatibility with the cash or accruals accounting methods, and the ownership arrangement during the loan tenure. Despite these distinctions, all these loan options are offered at our competitive interest rates, featuring a fixed interest rate, a fixed loan term extending up to 7 years, and steady, predetermined repayments.
Low docs and no docs truck loans are available across our portfolio.
Calculating Truck Finance Alternatives
If you’re weighing up options and alternatives to your current finance deals or considering taking on new truck loans, our truck loan repayment calculator can be of great assistance in your planning.
These tools are valuable for strategizing your next steps and providing clarity when reviewing and adjusting your financial plans, including loan restructuring. Alternatively, you can reach out to Jade Truck Loans directly, where our consultants can take the lead in finding and tailoring a loan solution that aligns with your needs.
No matter the shifts in circumstances you're navigating, we're here to support you on the lending aspect of these changes.
Contact 1300 000 003 for a quote on a truck loan.
DISCLAIMER: THIS INFORMATION IS ISSUED PURELY FOR THE PURPOSE OF GENERAL INFORMATION PROVISION. IT IS NOT TO BE TAKEN AS THE ONLY SOURCE OF INFORMATION FOR BASING FINANCIAL DECISION-MAKING. THOSE REQUIRING FINANCIAL GUIDANCE AND ADVICE SHOULD CONSULT WITH THEIR FINANCIAL CONSULTANT OR ADVISOR. NO LIABILITY IS ACCEPTED FOR ANY MISREPRESENTATION OF POLICIES, DATA OR ERRORS IN THIS CONTENT