Well………..yes and no. We’ve all heard the stories of the person with limited life experience who casually bowled into a caryard, showed their drivers licence and came away with an expensive new ride, just by signing their name. And the one about the profitable business, with extensive history and asset backing………….knocked back for a small loan by their own bank. Both stories have an element of truth in them and deserve explanation. Before considering making a purchase it is worth making enquiries about the most important part – how to pay for and finance it.
Finance availability has become more complex in recent times – changes are driven by the relentless march of technology, with Artificial Intelligence replacing human input, coupled with new and innovative finance providers muscling in on the banks’ territory. The days of meeting a loans officer with approval authority are long gone, as is the sole reliance upon profit & loss statements and tax returns. Blanket lending policies extend to the age and nature of the goods being purchased as much as the experience and credit history of the borrower. Bank statements, ATO portals, Business Activity Statements (BAS), even 6-12 months of statements for another loan are tools used for credit assessment.
The biggest impact is that applications are ‘pigeon holed’ in accordance with strict and unbending criteria – your lender who will happily approve a new piece of machinery without any financial data (at a very good interest rate) may decline an application for the modest purchase of a secondhand car.
Over time we have had the pleasure of maintaining relationships with customers who have taken their businesses from an idea to a large enterprise. Some have said that they may not have been able to grow and develop without the confidence of having access to the quick resources of their broker.
We advocate that anybody considering the purchase of cars, equipment and the like (whether for business or personal use) should seek out the services of a broker specialising in asset finance, just as they would do for insurance or accounting and taxation services. Australiawide Finance is a member of CAFBA (Commercial & Asset Finance Brokers Association), the peak representative body for equipment finance brokers in Australia. All CAFBA members undergo annual professional development training and are well placed to provide guidance and advice.
Finance tips
- Have your finance organised before shopping for your intended purchase – you’ll know the cost, save time and can settle the purchase quickly, which may in turn lead to a reduced price
- Seek out a finance expert and ask as many questions as you need to. If you get clear answers which leave you comfortable, you’re in good hands
- Have a broad idea of what you want and be clear of the reason for the purchase
If you would like further information contact us anytime for a confidential and obligation free discussion or finance quote.
