With asset finance, the thing you're buying, whether it's a ute, an excavator or a dental chair, secures the loan. If repayments stop, the lender can take the asset back. That's why asset finance usually comes with lower rates and simpler approval than a general business loan. A business loan is more flexible. You can spend it on anything, such as wages, stock, marketing or a slow quarter, but it often needs other security, such as property or a personal guarantee, and rates can be higher. If you're buying specific equipment, asset finance is usually the cheaper route. If you need working capital, a business loan fits better. Plenty of businesses use both, and we work out which suits each purchase.

They sound alike, but they work differently. With a chattel mortgage, you own the asset from day one, and the lender holds a mortgage over it until it's paid off. It's the most common choice for small businesses. With a finance lease, the lender owns the asset and you pay to use it, then decide at the end whether to pay a final amount to keep it, upgrade or hand it back. Hire purchase is similar to a lease, except ownership passes to you after the last payment. Each treats GST, depreciation and tax deductions differently, and tax rules change, so run the choice past your accountant. We lay the options side by side with real repayments so you can compare them properly.

Possibly, depending on your trading history. Lenders generally like to see an ABN that's been active for at least six to twelve months, and for larger amounts many want two years of financials. A newer business isn't automatically ruled out, though. For smaller amounts, some lenders offer low doc asset finance, which relies on your ABN, GST registration and bank statements instead of a full set of accounts, usually at a higher rate. A deposit or a director's guarantee can also help if you're just starting out. It follows a similar logic to loans for self-employed borrowers, but asset finance is often quicker, because the asset itself backs the loan.

Yes, it is different. If the vehicle is mainly for business, such as a ute, van, truck or work car, asset finance in the business's name is usually the right fit, and there may be tax benefits to discuss with your accountant. If it's mainly for personal use, a personal car loan is more appropriate. Personal loans and car loans are assessed on your personal income, while business finance looks at the business. Lenders will also ask how the vehicle will be used. Beyond vehicles, you can often finance machinery, medical and dental equipment, IT hardware and commercial kitchen gear, and second-hand assets are usually fine within age limits. We check which category your purchase falls into before you sign.

A balloon payment, sometimes called a residual, is a lump sum due at the end of the loan. Deferring part of the cost lowers your repayments during the term, which helps cash flow when you've just bought equipment that hasn't started earning yet. The catch is that you'll owe that lump sum at the end, and the deferral adds interest overall. A balloon makes sense when the asset holds its value well, or you plan to trade it in or refinance. It's a poor fit if you're only using it to stretch to something you can't comfortably afford. We'll model a few balloon sizes so you can see the trade-off between lower payments now and a bigger bill later.

Dealer finance is convenient, but convenient and cheapest aren't always the same thing. A dealer's finance manager offers the lenders they have an arrangement with, and the rate and fees can reflect that. An asset finance broker compares lenders across the market and negotiates for you, so it's worth getting a quote before you walk into the showroom. As a business and commercial lending broker, we can also package the asset loan alongside your other borrowing, so one loan doesn't undermine another. We work with business owners across Sydney and in Melbourne, and if the dealer's offer is already competitive, we'll tell you.