Truck Finance Australia: Complete Commercial Vehicle Loans Guide

Truck finance in Australia enables transport operators and businesses to acquire commercial vehicles through chattel mortgages, equipment loans, hire purchase, or finance leases. In 2025, rates typically range from 7-14% p.a. (indicative only, subject to individual circumstances), with loan amounts from $20,000 to $500,000+ for vehicles ranging from light commercials to prime movers. Terms usually span 2-7 years depending on vehicle type and usage. Tax benefits may include depreciation deductions, immediate GST credits, and potential instant asset write-off for eligible businesses. Settlements possible within days for established transport operators with solid trading history and reputable truck dealers.

Understanding Truck Finance in Australia

For transport operators, logistics companies, and businesses relying on commercial vehicles, trucks represent essential income-generating assets. Whether you’re an owner-driver buying your first rigid truck or an established fleet operator adding prime movers, truck finance provides a way to acquire vehicles while preserving working capital for fuel, maintenance, and operational costs.

The Australian commercial vehicle finance market has evolved significantly, with lenders now offering specialized products designed specifically for transport operators. These products recognize the unique challenges of the industry—seasonal freight volumes, fuel cost volatility, and the high capital cost of modern trucks.

Why Truck Finance Makes Sense

• Preserve cash flow: Trucks cost anywhere from $50,000 for a used light commercial to $300,000+ for a new prime mover. Finance spreads this cost over the vehicle’s working life.
• Tax effectiveness: Subject to your circumstances, truck finance may provide depreciation deductions, interest deductions, and immediate GST credits.
• Keep equipment current: Regular upgrades help maintain fuel efficiency, meet emission standards, and reduce maintenance costs.
• Business growth: Finance enables you to take on additional work without waiting to accumulate full purchase price.

For broader commercial vehicle options, see our asset finance guide.

Types of Truck Finance

Chattel Mortgage

The most popular truck finance structure in Australia. You own the vehicle immediately, claim the full GST credit upfront (if registered), and may deduct depreciation and interest subject to your tax circumstances.

• How it works: The lender provides funds to purchase the truck. You own it from day one, with the lender holding security until you’ve paid off the loan. You make regular repayments including principal and interest.
• Tax benefits: Subject to your individual circumstances, you may claim depreciation, interest deductions, and upfront GST input tax credits. Always consult your accountant.
• Best for: Established transport businesses wanting maximum tax benefits and long-term ownership.
• Typical terms: 3-7 years for trucks
• Indicative rates: 7-12% p.a. for strong applications (subject to individual circumstances)

Learn more about chattel mortgage structures.

Commercial Hire Purchase

Provides immediate use of the truck while you pay it off, with automatic ownership transfer after the final payment.

• How it works: The lender purchases the truck and you hire it while making regular payments. After the last payment, ownership transfers to you.
• Tax benefits: You may claim depreciation and the interest portion of repayments, subject to your tax circumstances.
• Best for: Transport operators wanting eventual ownership with a clear payment path.
• Typical terms: 3-7 years
• Indicative rates: 8-13% p.a. (rates vary by circumstances)

Finance Lease (Operating Lease)

The lender owns the truck and you lease it for a fixed term. At the end, you can return it, upgrade to a newer model, or purchase at market value.

• How it works: The lender purchases and owns the truck throughout the lease period. You make regular lease payments and have options at term end.
• Tax benefits: Lease payments may be fully tax-deductible as operating expenses, subject to your circumstances.
• Best for: Fleet operators wanting to keep trucks current or businesses preferring consistent operating expenses.
• Typical terms: 3-5 years
• Indicative rates: 9-14% p.a. (subject to assessment)

Equipment Loan (Secured)

A traditional secured loan where you own the truck from day one, with the lender holding security.

• How it works: You borrow funds to purchase the truck, own it immediately, and repay over an agreed term.
• Tax benefits: Similar to chattel mortgage—depreciation and interest deductions subject to your circumstances.
• Best for: Straightforward truck purchases with established businesses.
• Typical terms: 2-7 years
• Indicative rates: 7-12% p.a. (rates depend on individual circumstances)

For equipment finance across different asset types, explore our equipment finance Australia guide.

What Trucks Can You Finance

Australian lenders finance a comprehensive range of commercial vehicles:

Light Commercial Trucks (Under 4.5 tonnes GVM)

• Utes and cab chassis
• Small delivery vans
• Refrigerated vans
• Service vehicles
• Typical cost: $30,000-$80,000

Medium Trucks (4.5-12 tonnes GVM)

• Rigid trucks
• Tipper trucks
• Pantech vans
• Refrigerated trucks
• Typical cost: $80,000-$180,000

Heavy Rigid Trucks (12+ tonnes GVM)

• Multi-axle rigids
• Concrete agitators
• Waste collection trucks
• Crane trucks
• Typical cost: $150,000-$300,000

Prime Movers & Articulated Trucks

• Prime movers (single and twin steer)
• B-doubles and road trains
• Logging trucks
• Typical cost: $200,000-$400,000+

Trailers

• Semi-trailers (flat top, curtain sider, refrigerated)
• B-double combinations
• Specialised trailers (tippers, low loaders)
• Typical cost: $30,000-$150,000+ For semi-trailer specific financing, see our semi-trailer finance guide.

Specialised Commercial Vehicles

• Food trucks and mobile businesses
• Tow trucks
• Car carriers
• Tankers
• Emergency vehicles

How Much Does Truck Finance Cost

Interest Rates

Truck finance rates in Australia vary significantly based on multiple factors: Rate influencing factors:

• Vehicle type, age, and condition
• Loan amount and term
• Business trading history and financial strength
• Personal and business credit history
• Deposit amount
• Current market conditions

Indicative rate ranges (as of 2025):

Rates are indicative examples only. Actual rates depend on individual circumstances and lender assessment. Rates are not published publicly and require individual quoting.

Typical Loan Terms

• Light commercial trucks: 2-5 years
• Medium trucks: 3-5 years
• Heavy trucks and prime movers: 3-7 years
• Used trucks: Generally shorter terms (2-5 years) depending on age

Deposit Requirements

• New trucks: Often 10-20% deposit, though 100% finance may be available for strong applications
• Used trucks: Typically 20-30% deposit required, increasing with vehicle age
• No deposit options: Available for established businesses with strong financials, though rates may be higher

Balloon Payments

Many truck finance agreements include balloon (residual) payments to reduce monthly costs: Common balloon structures:

• 20-30% for prime movers and heavy trucks
• 10-20% for medium trucks
• 0-20% for light commercial Important: Factor in how you’ll pay or refinance the balloon at term end. Large balloons reduce monthly payments but increase total interest paid.

Eligibility Requirements

General Criteria

While specific requirements vary by lender and loan amount, eligibility criteria may vary by industry. Most lenders typically consider:

• Trading history: Usually 12-24 months minimum, though some specialist lenders may consider newer operators with strong industry experience
• Credit history: Both business and personal credit scores matter, particularly for owner-drivers and smaller transport companies
• Serviceability: Evidence you can service repayments even during quieter freight periods
• Deposit: Larger deposits typically result in better rates and easier approval
• License requirements: Appropriate driver’s license for the vehicle class

Owner-Driver Specific Considerations

• Freight contracts: Ongoing or regular freight agreements strengthen applications
• Industry experience: Demonstrated transport industry experience, even if business is new
• Work history: Previous employment as a truck driver or in transport operations
• Network: Established relationships with freight companies or logistics providers

Fleet Operator Considerations

• Fleet management experience: Track record managing multiple vehicles
• Existing assets: Current fleet composition and condition
• Maintenance records: Documentation of proper vehicle maintenance
• Business structure: Company structure often preferred over sole trader for large fleets

For self-employed transport operators, see our ABN loans Australia guide.

Tax Benefits of Truck Finance

Truck finance may offer several tax advantages, subject to your individual circumstances:

Depreciation Deductions

• Chattel mortgage and hire purchase: Claim decline in value over the truck’s effective life (typically 5-8 years for trucks, depending on usage intensity)
• Finance lease: Lender claims depreciation as they own the vehicle

Interest Deductions

Deduct the interest portion of finance repayments, subject to tax rules and your business structure.

GST Input Tax Credits

With chattel mortgages and equipment loans, GST-registered businesses can claim the full GST input tax credit upfront on the purchase price (including GST).

Instant Asset Write-Off

May be available for eligible businesses under current ATO thresholds. Check current limits as these change periodically.

Fuel Tax Credits

Separate from finance but relevant—heavy vehicle operators may claim fuel tax credits for business use.

Important: Tax benefits vary significantly based on your business structure, income level, and how you use the truck. Always consult your accountant before making financing decisions.

New vs Used Truck Finance

New Trucks

Advantages:

• Best finance rates (typically 7-11% p.a.)
• Longest terms available (up to 7 years)
• Full manufacturer warranty
• Latest safety and emission technology
• Lower maintenance costs initially
• Easier approval process

Considerations:

• Higher purchase price
• Steeper depreciation in early years
• May be overkill for some applications

Finance implications: New trucks typically secure better rates and longer terms due to lower lender risk.

Used Trucks

Advantages:

• Lower purchase price
• Slower depreciation
• Proven reliability for specific models
• May better suit cash flow constraints

Considerations:

• Higher finance rates (typically 9-15% p.a.)
• Shorter terms (usually 2-5 years)
• Higher maintenance costs
• May require larger deposits
• Age restrictions (many lenders limit to 10-15 years total age at term end)

Finance implications: Used trucks require more careful assessment. Lenders consider age, kilometers, condition, and maintenance history.

Age and Kilometers Matter

Lender preferences:

• Under 5 years old: Best rates, longest terms
• 5-10 years old: Moderate rates, standard terms
• Over 10 years old: Limited options, higher rates, shorter terms

Kilometer considerations:

• Under 500,000km: Standard assessment
• 500,000-800,000km: More scrutiny, may affect terms
• Over 800,000km: Limited lender appetite, may require specialist lenders

Application Process

Step 1: Determine Your Needs

Identify your requirements:

• Vehicle type and specifications
• New vs used
• Budget and deposit availability
• Finance structure preference

Calculate affordability:

• Monthly repayment capacity
• Operating costs (fuel, maintenance, insurance, registration)
• Seasonal cash flow variations
• Balloon payment strategy (if applicable)

Step 2: Gather Documentation

Business information:

• ABN/ACN details
• Business structure documents
• Trading history (tax returns, BAS statements)
• Recent business bank statements

Financial information:

• Profit and loss statements
• Balance sheet (if applicable)
• Details of existing debts and commitments
• Asset list

Vehicle information:

• Detailed truck quote or purchase agreement
• Vehicle specifications (make, model, year, kilometers)
• Vehicle history report (for used trucks)
• Dealer details

Personal information:

• Driver’s license
• Personal bank statements
• Personal credit history
• Proof of address

Step 3: Compare Options

Consider multiple lenders:

• Major banks
• Specialist truck finance providers
• Non-bank lenders
• Equipment finance specialists

Compare factors beyond rate:

• Fees and charges
• Flexibility (early repayment, additional repayments)
• Balloon payment options
• Approval timeframes
• Lender reputation in transport industry

Modern comparison platforms allow you to see multiple options quickly. Visit our homepage to compare truck finance options.

Step 4: Submit Application

Through a broker:

• Often faster than going direct
• Access to multiple lenders simultaneously
• Broker handles negotiation and paperwork
• May secure better rates through lender relationships

Directly to lender:

• Can work well if you have existing banking relationship
• May have streamlined processes for existing customers

Step 5: Assessment and Approval

Lender assessment process:

• Credit checks (business and personal)
• Serviceability calculations
• Vehicle valuation and inspection
• Documentation verification

Timeframes: Established transport businesses with standard trucks may receive approval within 2-5 business days for straightforward applications. More complex situations or unusual vehicles may take longer.

Step 6: Settlement

Once approved:

• Review and sign finance documents
• Arrange insurance (comprehensive cover required)
• Lender pays dealer or seller
• Vehicle registration transferred
• Security registered on PPSR
• Repayments commence

Common Mistakes to Avoid

• Underestimating Total Costs: Don’t just focus on the repayment amount. Factor in fuel, insurance, registration, maintenance, tires, and tolls.
• Over-Borrowing: Lenders may approve more than you comfortably need. Borrow conservatively with a buffer for quieter periods or unexpected repairs.
• Wrong Finance Term: Match the term to the truck’s productive working life. Financing an old truck over too long a term can lead to problems.
• Ignoring Balloon Payments: Large balloons reduce monthly costs but create a significant liability at the end of the term. Have a clear plan to pay or refinance it.
• Buying Wrong Truck: Bigger isn’t always better. Ensure the truck’s size and specifications match your actual freight requirements to manage operating costs.
• Not Shopping Around: Your existing bank may not offer the best deal. Specialist transport lenders often provide more competitive rates and suitable structures.

Choosing the Right Truck Finance

Questions to Ask Yourself

• Ownership intentions: Keep long-term (Chattel Mortgage) or upgrade regularly (Lease)?
• Tax position: Profitable and need deductions (Chattel Mortgage)?
• Cash flow: Strong and consistent (shorter term) or variable (longer term with balloon)?
• Vehicle type: Standard (more options) or specialised (needs specialist lender)?

When to Use Chattel Mortgage

Best for established transport businesses (12+ months) wanting to maximize tax deductions and own the truck long-term, especially if GST-registered.

When to Consider Finance Lease

Best for fleet operators wanting consistent budgets, businesses that upgrade trucks every 3-5 years, or those who don’t want to manage vehicle disposal.

When Hire Purchase Makes Sense

Best for operators wanting eventual ownership but need more flexibility than a chattel mortgage, or those building their business credit history.

For construction vehicles and earthmoving equipment, see our excavator finance guide.

Truck Finance Example

Scenario: Melbourne transport operator financing a $180,000 Isuzu FVZ 240-300 medium rigid truck

Finance Structure:

• Purchase price: $180,000 (including GST)
• Deposit: $36,000 (20%)
• Amount financed: $144,000
• Interest rate: 9.2% p.a. (example rate)
• Term: 5 years (60 months)
• Balloon payment: $36,000 (20% residual)
• Indicative Monthly Repayment: ~$2,680
• Total Interest Paid: ~$54,000
• Total Cost (including balloon): ~$234,000

This example is for illustration purposes only. Actual rates, terms, and repayments depend on lender assessment, your individual circumstances, and current market conditions. Consult your accountant regarding tax implications.

Compare Truck Finance Options

Ready to finance your commercial truck?

Loan Phone provides fast comparison of truck finance options from 100+ lenders including major banks and specialist transport finance providers.

• Fast Online Comparison — See personalised rates from multiple lenders in minutes
• Transport Industry Specialists — Brokers who understand trucking and logistics
• Flexible Structures — Chattel mortgage, hire purchase, lease, or loan options
• New & Used Trucks — Finance options for all commercial vehicle types and ages
• Better Rates — Specialist lenders often provide better terms than major banks
• Owner-Driver Friendly — Solutions for solo operators and growing fleets

Speak with specialists:

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Last updated: October 7, 2025