Heavy vehicle finance · Prime movers, rigids and trailers
Truck finance for owner-drivers and fleets.
A truck is not a purchase, it is a piece of plant that has to earn its own repayment every week. The finance is the easy part. The part worth getting right is whether the rate the truck earns still covers the repayment once tyres, rego, insurance and a compliance service have all landed in the same month.
Start here
Three structures, and the difference is who owns the truck.
Heavy vehicle finance is usually written as commercial lending, on the footing that the truck is predominantly for business use. Within that, almost everything you will be offered is one of three shapes. They can produce a similar-looking weekly number and still be very different agreements.
| Structure | Who owns the truck | How it sits on the books | Where it tends to suit |
|---|---|---|---|
| Chattel mortgage | You do, from the day it settles. | The truck is your asset and the finance is your liability. The financier registers its security interest on the PPSR and releases it when the contract is paid out. | The most common structure for owner-drivers and small fleets who intend to keep the truck. You can sell it whenever you like, provided the payout is settled at the same time. |
| Finance lease | The financier does, for the life of the lease. | You have the use of the truck and a lease obligation, including a residual amount owing at the end of the term. Title passes only if and when that residual is dealt with. | Operators who prefer a fixed use-cost and want the end-of-term decision left open. Ask your accountant how a lease is treated before you assume it is better or worse than a mortgage. |
| Rent-to-own | The financier does, all the way through. | It is a rental agreement first. You pay to use the truck, with a purchase option or a final payment at the end that converts it to yours. | Sometimes the only structure available where trading history is short or credit is impaired. It generally costs more across the whole term than owning from day one, which is the trade-off you are accepting. |
Depreciation, GST, input tax credits and what you can and cannot claim all turn on your structure, your turnover and how the truck is used. Those questions have real answers, but they belong to your accountant or registered tax agent. What we can do is arrange whichever structure the two of you decide on, and tell you honestly what each one does to your ownership, your flexibility and your total cost.
One thing worth knowing early: because these contracts are usually commercial, the consumer protections that apply to a personal car loan generally do not apply the same way, so the contract carries more weight and is worth reading properly. If the truck is really for private use, say so — it changes which lending applies to you.
The assessment
What a lender is actually weighing.
The operator
How long you have been trading under your own ABN, whether you are registered for GST, and what your returns and bank statements show. A driver who has been subcontracting for years reads very differently to someone stepping out of an employed seat next month, even when the licence and the experience are identical.
The truck
Age, kilometres, make, configuration and condition. The truck is the security, so the lender is forming a view on what it could be sold for partway through the term if things go wrong. A common, well-supported model in a strong resale market is easier to fund than something rare or heavily specified.
The work
What the truck will be carting, for whom, and how reliably. A signed contract or a standing relationship with a prime contractor tells a lender something that a hopeful projection does not. Existing commitments matter too, including other equipment finance and any personal debt sitting behind the business.
The asset
New, used, and why the odometer matters so much.
On a secured loan the lender's fallback position is the truck itself. That is the whole reason age and kilometres get the attention they do — not because an older truck is a worse truck, but because it is harder to value and quicker to fall away underneath the debt.
Buying new
- Predictable early years. Warranty coverage, a known service schedule and no inherited neglect. For an owner-driver with one truck and no spare, an unplanned week off the road is the expensive thing, not the price of the truck.
- Depreciation is steepest at the start. You carry that drop. It shows up if you need to sell early.
- Build lead times. If the truck is being bodied or specced, the gap between order and delivery affects when finance can settle and when it starts earning.
Buying used
- More truck for the money. The usual reason people go this way, and often a sound one.
- Age at the end of the term is what counts. Lenders look at how old the truck will be when the last payment falls due, not just today. That is why an older unit often comes with a shorter available term, which pushes the repayment up.
- Evidence does the heavy lifting. Service records, a legible history, an engine and driveline report and a PPSR check on the seller. A used truck with paperwork is a different proposition to the same truck without it.
- Private sales carry more checks. Confirming there is no money owing, verifying the seller and handling settlement properly all take longer than a dealer purchase, and not every lender funds them.
The honest bit
Balloons and residuals: read this before you agree to one.
A balloon on a chattel mortgage, or a residual on a lease, is a lump sum deliberately left unpaid until the end of the contract. Because you are only paying interest on it along the way rather than paying it down, the weekly repayment drops. That is the entire appeal, and for a business managing cash flow it can be a perfectly rational choice.
The part that gets glossed over is this. A balloon does not reduce what the truck costs. It moves money to the end and adds interest to it in the meantime, and it creates a risk specific to hard-working assets.
Your debt falls on a schedule set at signing. The truck's value falls on its own schedule, set by kilometres, condition, the state of the used market and whatever has happened to the driveline. Those two lines do not have to meet. If you have run harder than expected, or the resale market has softened, you can arrive at the end of the term owing more than the truck will fetch — so selling it does not clear the debt, and you are covering the difference out of your own pocket.
That is not an argument against balloons. It is an argument for choosing one deliberately, with an answer to a simple question: what is the plan when it falls due? Realistically there are three, and it is worth picking yours now rather than in the last month.
- Pay it out. Cleanest, and it means putting money aside across the term rather than hoping the year is kind.
- Sell or trade the truck and clear it from the proceeds. Works when the truck is worth more than the balloon. That is the assumption to stress-test, not to trust.
- Refinance the balance. Usually possible, but it is a new application on the day, assessed on your position and the truck's age at that point. It is not something anyone can promise you in advance.
Set the balloon against how you actually run. High kilometres, heavy haul, unsealed roads and long hours pull resale value down faster than a spreadsheet assumes. If the only way the repayment fits is with a large balloon on the end, the truck is probably more truck than the work supports, and we would rather say that early.
Where you are up to
First truck, or fifth.
Trading history is not a formality. It is the closest thing a lender has to evidence that the repayment will keep being made once the novelty wears off, and it is usually the biggest single difference between two applicants buying the same truck.
| First-time owner-driver | Established operator | |
|---|---|---|
| What the lender is missing | Proof that the business earns. Your driving record is real experience, but wages under someone else's ABN are not the same as invoices under yours. | Usually nothing. Returns, BAS and statements show what the business actually does, across good quarters and quiet ones. |
| What helps most | Years of licensed driving in the same class of work, a deposit or a trade, a confirmed contract or subcontract arrangement, and clean personal credit. Property ownership is often relevant. | Consistent turnover, equipment finance repaid on time, and a clear story for how another truck earns its keep rather than splitting the same work in two. |
| Usual sticking points | Fewer financiers to choose from, and generally less sharp pricing while there is less evidence to price against. | Total exposure across the fleet, seasonal cash flow, and how the ownership structure and any guarantees are set up. |
| What we would do | Build the file properly before it goes anywhere: contract, deposit, servicing plan, budget. A first application that is well put together beats three that are not. | Look at the fleet as a whole rather than one truck at a time, including whether refinancing existing units alongside the new one produces a better overall position. |
If you are trading through a company or trust, expect the directors to be asked for a personal guarantee. That is standard in commercial finance and it means the debt does not stop at the company. Understand what you are signing, and if you have a partner, have the conversation with them rather than about them.
Affordability
The repayment is not the cost of the truck.
Most owner-drivers who get into trouble did not get the finance wrong. They budgeted the repayment accurately and everything else optimistically. These are the costs that decide whether a repayment is genuinely affordable, and they do not arrive evenly.
The useful exercise is working out your cost per kilometre with all of the above included, setting it against the rate you are actually paid, and seeing what is left. If the margin only works at full utilisation with no breakdowns, it is too tight.
Common questions
Truck finance, answered.
Chattel mortgage or finance lease — which one should I take?
The structural difference is ownership. Under a chattel mortgage the truck is yours from settlement and the financier holds security over it. Under a finance lease the financier owns it and you have the use of it, with a residual to deal with at the end. Which is better for you depends heavily on how the two are treated for tax and accounting in your particular business, and that is genuinely a question for your accountant rather than for a broker. Once you have their view, we will arrange whichever structure you have decided on.
How does rent-to-own differ from the other two?
It is a rental agreement rather than a loan. The financier owns the truck throughout and you pay to use it, with a purchase option or final payment converting it to yours at the end. It exists mainly for operators who cannot access conventional finance yet — short trading history, past credit trouble, or an asset other financiers will not touch. It usually costs more in total than owning from day one. Sometimes that is a fair price for getting a truck earning; sometimes it is worth waiting six months and building the file instead. We will tell you which we think it is.
Can I get finance for my first truck as a new owner-driver?
It happens regularly, but the file has to be built rather than just submitted. Without trading history, the things that carry weight are your driving experience in the same type of work, a deposit or trade-in, a contract or subcontract arrangement you can evidence, clean personal credit and your overall asset position. Fewer financiers will look at a start-up operator, and pricing generally reflects that. What we will not do is lodge it in several places at once to see what sticks, because a run of declines makes the next attempt harder.
How old a truck can I finance?
There is no single answer, because every financier sets its own view and they differ considerably. What is consistent is the logic: they look at how old the truck will be at the end of the term, not just today, because that is when their security is thinnest. In practice an older truck often means a shorter available term, which raises the repayment even though the purchase price is lower. Send us the details of the truck you are looking at and we will tell you where it sits before you commit to anything.
Should I put a balloon on it?
Only with a plan for paying it. A balloon lowers the weekly repayment by leaving a lump sum owing at the end, and it raises the total cost because you pay interest on that amount the whole way through. The real risk is that the truck is worth less than the balloon when it falls due — high kilometres, hard work or a soft used market can all do that — which leaves you covering the gap from your own funds. If the repayment only fits with a large balloon behind it, that is usually a sign about the truck, not about the structure.
Do I need a deposit?
Not always, and it varies by financier, by the truck and by your trading history. What is reliably true is that contributing something meaningful reduces the financier's exposure, widens the range of lenders willing to look at it and generally improves the terms available. A trade-in counts. So does equity in a truck you already own outright. If you are a first-time operator, a deposit is often the thing that turns a marginal application into a workable one.
What paperwork should I have ready?
For an established business: recent business bank statements, your most recent tax returns and financials, BAS lodgements, ABN and GST details, and a list of existing equipment commitments. For a newer operator: personal tax returns and payslips from your driving work, personal bank statements, your licence and any relevant accreditation, plus evidence of the work lined up. In both cases, details of the truck — the listing or invoice, VIN, kilometres and service history. Missing paperwork is the usual reason things drag, far more often than the assessment itself.
Can I finance a trailer, a body or a refrigeration unit as well?
Generally yes. Trailers, tippers, tautliners, cranes, refrigeration units and body builds are all financeable, sometimes on the same contract as the prime mover and sometimes separately, depending on the financier and how the build is invoiced. Tell us the whole picture at the start, including anything fitted after delivery, so it is structured once rather than patched together later.
Let's talk
Tell us the truck and the work. We'll tell you how it stacks up.
No cost, no obligation, and nothing goes near your credit file while we work out where you stand. If the numbers work, we'll find the structure that suits. If they don't, you'll hear that from us before you have signed anything.
The Finance Team is a trading name of Online Showroom Pty Ltd, holder of Australian Credit Licence 551493. We act as a credit broker rather than a lender, so nothing on this page is an offer of credit. Any amount, term, structure or repayment we discuss is an estimate for illustration only, and every application is subject to assessment and approval by the financier.
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