Obtaining equipment financing doesn’t have to be an obstacle. Many Australian businesses just like you qualify for low doc equipment finance, which provides you with access to the funds you need faster and more easily. This type of loan can be issued without the need to present extensive documents and details of your business finances.
While not everyone will be eligible for low doc loans, the criteria are not exceedingly stringent. Curious if your business might qualify? Read on to discover the specifics of this straightforward commercial financing option.
Equipment Financing at its Simplest
Rare is the company which doesn’t require some sort of equipment to do business. From farming equipment to construction equipment to trucks, most businesses need a wide range of tools to help them provide services, create products, or deliver goods. Equipment is needed when a business first sets up shop, but is also necessary throughout the life of the business as well. Worn out equipment will need to be replaced and upgrading to the newest models or most advanced technology is often a necessity for providing your best work as your industry evolves. This can be essential to continuing profits and ensuring your business’s success. When these times come, you need the funds to be easily accessible in a short period of time. Low doc equipment financing is for many businesses the simplest way to get the money they need when they need it.
Why Low Doc Loans?
Low document financing is a great loan choice for the self-employed or small business owner. These types of businesses are busy servicing their customers and doing what they can to win more sales, and may not have the time necessary to compile the many documents traditional business lending demands. The “low doc loan” approach means that income and assets can be verified via alternate means. Instead of a stressful experience searching for documents (many of which you may not even have to hand) a low doc loan offers the same end result with a more straightforward process.
So what is needed for low doc commercial loans?
First, your business must have been registered for GST for more than two years. This confirms that for two consecutive years the business has had a turnover of more than $75k, which is a good starting point for the lender to assume your business’s ability to service the loan. Because of this, a brand new business won’t be eligible for the low doc finance approach.
The second consideration is you and your fellow business owners. If you’re registered as a company, all the directors within your business must have a good credit history. Unsure about your credit rating? Check out our list on what factors affect your score.
Third, eligibility for low doc equipment finance depends upon the goods to be purchased. Different lenders have different requirements. Some lenders require that the goods be purchased through a dealer, while others allow purchases to be made through a private sale. This often largely depends on the profile of the applicant. Age-wise, some lender restrictions demand that a piece of equipment be no older than 4 years when the loan settles. Others are more lenient and allow for the goods to be older. Occasionally, a lender may finance equipment that will be up to 15 years old at the end of the contract, meaning you could purchase equipment that is 9-10 years old at the start of a five year term. At ACA, we work with several different lenders who have a range of requirements; we will strive to find you the right match for your circumstances.
Lastly, you can boost your potential for low doc approval with home ownership or some other significant asset backing. This can help ensure your application goes through, however most lenders will consider an application without this, so long as the other boxes are ticked and a 20% – 30% deposit is put down.
Get Your Loans Faster
Need your commercial equipment now? Low doc financing can speed up the process significantly, getting you back to business faster. The low doc loan process can cut several days off of traditional loan processing, as it is much swifter to work without the need to go back and forth obtaining documents and data.
Ready to discover if low doc financing is right for your business? Give Australian Credit Acceptance a call today to discuss your needs with one of our friendly, knowledgeable financial advisors.