Business Loans
Your ability to grow your business isn’t limited, so why should your options for business loans? At AAA Finance we are committed to ensuring that, no matter what you need, we are the finance provider that will help you get it. AAA Finance can provide you a finance solution for any vehicle or piece of equipment your business may require.
Business Loan Options
All business loans are a type of chattel mortgage. Chattel mortgages are very much like a secured car loan however they are only for business use. The chattel is the asset, for example, car, truck or excavator. The mortgage is the funds borrowed to purchase the asset. Once the loan contract is complete, the business owns the asset outright. Using the asset as security for the loan reduces the risk to the lender. As a result lenders are more willing to offer very competitive interest rates.
There are 3 Types of Business Loans:
Many small business owners don’t complete their tax return at the end of the financial year. This makes sense, particularly if your business will owe tax to the Australian Government. Business owners are better off utilising those funds in their business until the tax is due.
A no doc business loan allows businesses to obtain finance without the need for up-to-date financials or any other paperwork for that matter. However, the business will need to declare to the lender an estimate of net income and gross turnover. A no doc business loan is for established businesses that have been operating for over 2 years, are GST registered and where the director/s own property.
A low doc business loan requires some proof of income. Although the lender may not require a recent full tax return, they could request 3 months bank statements to show that the business is generating sales. Other documentation that a lender may request could include the latest BAS, a profit and loss statement or a letter from your accountant. Every lender has different requirements, and every business has their own unique financial situation. This is where you need an experienced business finance broker to look after your interests – not the banks! To qualify for a low doc business loan, you will need to have an ABN running for a least 12 months and be GST registered.
As the name suggests, full documentation is required to prove your income. Documentation for full doc business loans usually includes a copy of the current business tax return and notice of assessment. Lenders may also request 3 months bank statements, BAS, profit and loss and/or a letter from your accountant.
Advantages of Business Loans
- You own the asset from the start of the agreement.
- GST registered customers can claim back the GST on the purchase price.
- Low establishment fee and monthly repayments with no payout penalties.
- Fixed interest rate for the term of the agreement.
- Monthly repayments fixed for the term.
- No GST charged on the monthly repayment.
- Access to further tax benefits where the truck, plant or equipment is used to generate income. (check with your accountant)
- Terms from 1 to 7 years.
- Balloon payments are available.
- Business loans from $5000 up to $1,000,000.
Business Loan Finance Calculator
Our easy to use Business Loan Calculator includes a balloon payment option. The calculator requires an estimate of loan amount, annual interest rate as well as the loan term in years. The interest rate depends on your profile, previous credit history as well as the type and age of asset you want to buy.
How to Qualify for a Business Loan
- Businesses can range from sole traders, partnerships and trusts to large corporations, however, they must have an ABN.
- The asset, being a car, truck, plant or equipment, must be used predominately for generating business income. In other words, the asset must be used for a minimum of 50% business related use.
- Documentation requirements vary between the different types of business loans as well as lenders. For example, a low doc business loan may only require 3 months recent bank statements however a full doc business loan may require full up-to-date tax returns and banks statements.
Useful link: Tax fuel credits
The Australian Taxation Office website has a useful page about fuel tax credits for business use of fuel.
Apply for a Business Loan
Speaking with an experienced commercial finance broker is the first step in securing business finance. Our business finance experts are ready to discuss your loan requirements. They will get to know you and your business so that we can represent you to the best of our ability. Furthermore our experienced team will leverage access to over 40 lenders to secure you the lowest interest rate and best loan terms tailored to your business needs.
Business Loan FAQs
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