A Commercial Loan Contract and Mortgage (CLCM), often referred to as a Chattel Mortgage, is a commercial finance product where AFS will lend money to your business to purchase a car, commercial vehicle, or other transport asset.

Your business takes ownership of the vehicle (the chattel) at the time of purchase and AFS takes a mortgage over the vehicle as security for the loan by registering an interest on the Personal Property Securities Register (PPSR). Once the contract is paid in full, the interest is removed giving your business clear title to the vehicle.

 

A CLCM is suitable for those companies, partnerships and sole traders who use the cash method of accounting (they record business income and expenses as and when they occur) as it allows them to claim the GST in the vehicle's price up-front. GST is charged on the purchase price of the vehicle but not the monthly rental or the contract balloon (final instalment). Where your business is registered for GST, you can claim some or all of the GST contained in the vehicle price as soon as you lodge your next BAS, rather than over the term of the loan. Under a CLCM, a business can claim the interest charges on the contract and depreciation up to the depreciation limit as a tax deduction.

Commercial Car Loan Essentials

6.45%

Fixed Rate Commercial Car Loan for a new vehicle or truck#

Benefits of a Commercial Loan:

  • Preserve Cash Flow: Preserves the existing cash and credit facilities of your business. Funds can either be invested in more productive areas of their business, or maintained to take advantage of an unexpected business opportunity.
  • Specific Asset Security: You do not have to provide additional business and/or personal assets as security.
  • Finance Additional Costs: Other costs associated with the purchase can be financed on the contract such as comprehensive insurance, registration and on-road costs.
  • Reduce Exposure: Ability to borrow less than the total invoice price of the goods by way of deposit.
  • Fixed Cost Contract: A fixed rate and term make for accurate budgeting and also provides a hedge against market fluctuations.
  • Flexibility: Loan repayments can be specifically structured to suit the business cash flow. A larger final payment called a Balloon Payment can be structured to reduce the regular monthly rentals, improving the cash flow of the business and making the vehicle more affordable.
  • Tax Treatment: The interest component of the payments and the depreciation on the goods are tax deductible if the asset is used to generate assessable income.
  • GST: If the business is registered for GST, it can claim the GST charged on the vehicle price as an input tax credit when the next BAS return is lodged.
  • Ownership: The vehicle is owned and registered by the borrowing entity.

# Commercial rates are only available for novated leases or businesses with a registered Australian Business Number (ABN) and where the goods being financed are predominantly for business use. Interest rate only applicable for new goods that have not been pre-owned and where the applicant has an established good credit history. Finance subject to approval, including the application of applicable lending criteria. Terms and Conditions apply. Fees and Charges are payable. Credit provider is Automotive Financial Services – Australian credit licence 383762. 

Fixed Rate Loan - Commercial Car Loan

from
6.45%
p.a# 

Interest Rate
30% to
60%
of Purchase Price

Balloon Amount

1–5
years

Loan Term
$15,000
to
$130,000

Loan Amount

Monthly

Repayment Frequency

Fees

Fees that will apply on settlement

The following upfront credit fees and charges are payable to AFS on the settlement date of the loan.  They are only payable if you proceed with the loan and are included in the loan amount.

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FEE TYPE DEFINITION AMOUNT
Establishment Fee Represents the reasonable cost for AFS to provide the loan to you $395
Credit Search Fee Represents the reasonable cost for AFS to conduct the necessary credit bureau searches per applicant $6.37
Security Registration Fee Represents the reasonable cost for AFS to register our financial interest in the goods $8

The following fees and charges are payable to AFS during the term of the loan.

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FEE TYPE DEFINITION AMOUNT
Monthly Administration Fee Represents the reasonable monthly cost for AFS to administer your loan whilst active $10

The following fees and charges may become payable to AFS during the term of the loan.

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FEE TYPE DEFINITION AMOUNT
Early
Termination Fee ##
Represents the fee that will be payable when you pay out your loan contract in full before the expiration of the term of the loan. The amount of the fee as at the disclosure date is the early termination fee percent applied against of the interest rebate if the loan contract is paid out anytime after the settlement date. 30% of the interest rebate
Dishonour Fee Represents the reasonable cost for AFS to process the dishonour of a loan repayment on each occasion $12
Repayment Book Fee Represents the reasonable cost for AFS to generate and issue a new repayment book on each occassion $35

Fees and Charges disclosed above are current as at 1st July 2018 but may change from time to time. Other fees and charges may be payable. Please review the fees and charges detailed in the pre-contractual statement for the specific loan or lease that you have chosen.

# Commercial rates are only available for novated leases or businesses with a registered Australian Business Number (ABN) and where the goods being financed are predominantly for business use. Interest rate only applicable for new goods that have not been pre-owned and where the applicant has an established good credit history. Finance subject to approval, including the application of applicable lending criteria. Terms and Conditions apply. Fees and Charges are payable. Credit provider is Automotive Financial Services – Australian credit licence 383762.

## Only applicable for the AFS Commercial Loan product. Please read the relevant product Terms & Conditions and pre-contractual statement (if applicable) if you are considering another loan product or lease.

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How to apply

 

Applying for a business loan online is fast and easy with AFS.

What's more there are no fees or charges payable to apply, even if you're approved!. Fees and charges are only payable if you decide to proceed with the loan.

Simply select any "Apply Now" button to get underway.

What to expect

STEP 1

Allow 10 minutes to complete your application online


STEP 2

Once you have submitted the application, you will receive an email notification advising you that we have receive your application and commenced the assessment process


STEP 3

You will also receive a number of disclosure documents by email. Please read these and save them for future record


STEP 4

We will respond to you within 2 working days:

  • To advise you of the application outcome once we have assessed your application and  verified all the information you have supplied
  • To obtain further information in order for us to complete processing your lease

STEP 5

If you don’t have all the information you need you can save a partially completed application and return to it, within 14 days, to complete the required information. We will issue you a secure login and password to the email address you supply us.


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