Choosing between a truck finance broker and a bank comes down to how established your business is, the truck you are buying, the documents you have available and how closely your circumstances fit standard lending criteria.
For an established transport business with strong financial statements and a long banking history, an existing bank may be a straightforward place to start. A new ABN, limited financial history, used truck purchase or previous credit issue can make the comparison more important because different lenders assess these applications in different ways.
The Asset Finance Shop (TAFS) arranges truck finance for Australian owner-operators, sole traders and transport businesses through access to more than 80 bank and non-bank lenders. Our internal credit team reviews each application before a formal lender submission, helping match the business with lenders whose criteria suit the applicant and truck being purchased.
This guide explains the differences between using a truck finance broker and approaching a bank directly, with particular focus on new ABNs and applications that need a more tailored assessment.
Both can provide commercial vehicle loans, but the process is different.
When you approach a bank directly, that bank assesses the application against its own products and lending criteria.
A truck finance broker can assess the application across a broader group of lenders and identify options based on the applicant's business history, credit position, truck and documentation.
For a newer transport business, that lender access can be particularly useful because there is no single set of rules that applies across the entire truck finance market.
One lender may require an established trading history, while another may consider a newer ABN when the owner has strong transport experience and confirmed work.
Banks provide truck financing directly to eligible business customers.
The bank will generally assess:
Established businesses with complete financial information and a strong banking relationship may find this process straightforward.
The main limitation is that the application is being assessed against one lender's policy. If that lender does not accept the ABN age, asset, documentation or credit profile, the business will need to consider another option.
A truck finance broker assesses the application before matching it with a lender.
At TAFS, the process begins by reviewing:
TAFS then assesses the scenario against the criteria of more than 80 lenders.
The aim is to identify a suitable lender before making a formal application.
This can be especially useful when the business does not fit a standard lending profile.
|
Factor |
Bank Direct |
Truck Finance Broker |
|
Lenders considered |
One bank |
Multiple lenders |
|
New ABN options |
Depends on the bank's policy |
Can compare lenders that consider newer businesses |
|
Low doc applications |
Depends on bank requirements |
Can compare selected low doc lenders |
|
Used trucks |
Subject to bank asset criteria |
Can compare lenders based on truck age and condition |
|
Private sales |
May be available depending on policy |
Can identify lenders that accept private purchases |
|
Credit issues |
Assessed under one credit policy |
Can compare lenders with different credit criteria |
|
Application support |
Direct with bank |
Broker prepares and manages the lender submission |
|
Initial credit review |
Depends on the bank |
TAFS begins with a soft credit check |
|
Settlement support |
Managed through the bank |
Broker coordinates lender, buyer and seller requirements |
Neither option is automatically better for every business. The right path depends on the applicant and transaction.
A broker can be particularly useful when the ABN is new because different lenders have different minimum trading requirements.
A newly registered business may not have:
That does not mean the applicant has no experience.
An owner-driver may have spent years working as:
Selected lenders may consider that background when assessing truck finance for a newer business.
The lender can also look at the expected work, applicant's financial position and the truck being purchased.
A strong new business application gives the lender a clear picture of how the truck will generate income.
Previous transport experience can be important when the business itself has limited trading history.
The lender may consider how long the applicant has worked in the industry, the type of vehicles operated and whether the new business is continuing similar work.
Evidence of upcoming work can support the application.
This might include:
The stronger the evidence of future income, the easier it is for the lender to understand how the truck will be used.
Even when complete financial statements are unavailable, bank statements can provide useful information about the applicant's current financial position.
They may show:
A deposit is not required for every application, but it can strengthen the proposal.
It reduces the finance amount and can give the lender more comfort where the business is new.
A trade-in may also contribute equity toward the purchase.
The truck should make sense for the work the business intends to perform.
The lender may consider:
A realistic truck purchase can make the application easier to support.
Some truck finance applications can be assessed under low doc lending criteria.
A low doc application may use:
Complete financial statements are not always required.
Low doc does not mean the lender skips its assessment. The lender still needs to be satisfied that the applicant can afford the repayments.
A truck finance broker can help determine which lenders consider low documentation applications before a formal submission is made.
Previous credit issues do not always prevent an applicant from obtaining truck finance.
The lender may consider:
A bank will assess those circumstances under its own credit policy.
A broker can compare lenders whose criteria differ, which may provide additional options depending on the situation.
Credit issues can still affect:
The full circumstances should be disclosed early so the application can be assessed properly.
Selected lenders may consider truck finance where the business has existing ATO debt.
The lender will usually want to understand:
ATO debt does not automatically mean an application will be declined, but it becomes part of the overall credit assessment.
A broker can identify lenders that are prepared to consider the situation before submitting the application.
Used trucks can be financed through banks and non-bank lenders, but their asset criteria can differ.
The lender may assess:
Some lenders are more comfortable with older trucks than others.
This is one area where lender comparison can be valuable because the truck itself can determine which providers are suitable.
Yes. Selected lenders will consider private-sale truck finance.
Private transactions usually require additional checks, including:
A broker can coordinate the buyer, seller and lender requirements through the settlement process.
Yes. Auction finance may be available depending on the applicant and lender.
Pre-approval can help the business understand its finance position before bidding.
Final approval will still depend on the truck purchased.
Before bidding, consider:
Auction payment deadlines can be short, so completing the initial finance assessment beforehand can help reduce delays.
The main finance product TAFS arranges for commercial truck purchases is a chattel mortgage.
Under a chattel mortgage:
A balloon payment can reduce regular repayments by leaving part of the finance amount until the end of the term.
The business may be able to claim the GST on the purchase price, along with eligible interest and depreciation deductions. Speak with your accountant about the tax treatment that applies to your circumstances.
It can be.
An established business may already have:
Approaching the existing bank can be a practical option.
It can still be useful to compare the proposed rate, term, balloon and repayment with other available truck financing options before committing.
A truck finance broker can be useful when:
The broker should understand the business, asset and intended use before recommending a lender.
Interest rate matters, but it is only one part of commercial vehicle finance.
Compare:
A low rate may not help if the lender requires a large deposit or will not finance the truck being purchased.
A lower monthly repayment may also come from a longer term or larger balloon, which can increase the amount paid over time.
TAFS reviews the applicant's ABN history, industry experience, financial position and proposed truck purchase.
TAFS begins with a soft credit check that leaves no mark on the applicant's credit file.
The internal credit team assesses the application against the criteria of more than 80 lenders.
Finance options are reviewed based on the business, truck and proposed structure.
Once a lender is selected, the formal application is submitted.
TAFS manages lender requirements and coordinates settlement with the truck seller.
Straightforward applications can be approved in as little as 24 hours once the required information is available.
Before submitting directly to a bank, ask:
Understanding these requirements before making a formal application can help avoid unnecessary delays.
Before choosing a broker, ask:
The right option depends on your business and application.
An established business with complete financial statements may be well suited to its existing bank. A broker can be useful where the business wants to compare lenders or has a newer ABN, limited documentation, used truck, private sale or more complex credit position.
Potentially. Each bank has its own minimum trading and documentation requirements.
Some newer businesses may find additional options through non-bank lenders that assess previous industry experience and future work alongside ABN history.
A broker can provide access to several lenders rather than relying on one lender's start-up policy.
This can help when the business needs a lender that will consider industry experience, a work source agreement or low doc application.
Yes. An asset finance broker can have access to both bank and non-bank lenders.
TAFS has access to more than 80 lenders.
Yes. Selected lenders provide low doc commercial vehicle loans.
The application may use bank statements, ABN information, industry experience and evidence of work instead of complete financial statements.
Previous credit issues do not automatically prevent approval.
The available options will depend on the type and age of the credit issue, current conduct, truck value, deposit and overall financial position.
Yes. Used truck finance is available through selected lenders.
Vehicle age, kilometres, condition and market value will affect the available options.
Yes. Selected lenders finance trucks purchased privately.
Additional vehicle, ownership and seller checks will be required before settlement.
Not through the TAFS process.
TAFS begins with a soft credit check and internal assessment before making one formal application to the selected lender.
TAFS can arrange approvals in as little as 24 hours for straightforward applications once the required information has been provided.
Applications involving new businesses, private sellers, older trucks or more complex circumstances may take longer.
TAFS can assess your ABN history, transport experience, credit position and proposed truck purchase before comparing suitable commercial vehicle loans through access to more than 80 lenders.
Start with a no-obligation assessment and a soft credit check that leaves no mark on your file. Contact The Asset Finance Shop or apply online at www.tafs.com.au.
The Asset Finance Shop (TAFS) is a commercial asset finance brokerage based in Sydney.
Information on this page is general in nature and doesn't take your personal circumstances into account. Speak to a TAFS broker for options tailored to your business, and to your accountant regarding tax treatment.