Understanding Asset Acquisition Through Finance
When your Queensland business needs new equipment, vehicles, or machinery, the upfront cost can put significant pressure on your cashflow. That's where asset finance comes in. Rather than depleting your working capital on a single purchase, asset finance allows you to spread the cost over time while still getting the equipment you need today.
Asset acquisition through finance isn't just about buying new equipment - it's a strategic approach to business growth. Whether you're a tradie in Cairns needing a new truck, a medical practice in Brisbane requiring the latest diagnostic equipment, or a construction company in Townsville looking to expand your fleet of excavators, there's a finance solution designed for your business needs.
Types of Asset Finance Available
At Premium Finance Group Australia, we access Asset Finance options from banks and lenders across Australia, giving you choice and flexibility. Here are the main finance options available:
Chattel Mortgage
A chattel mortgage is popular among businesses for purchasing vehicles and equipment. You own the asset from day one, which means you can claim tax benefits through depreciation. With fixed monthly repayments and the option of a balloon payment at the end of the term, you can structure the loan to suit your cashflow requirements.
Hire Purchase
With hire purchase, you make regular payments over an agreed period, and once the final payment is made, you own the asset outright. This option provides certainty with fixed interest rates and is suitable for businesses looking for straightforward ownership.
Finance Lease
A finance lease allows you to use equipment throughout the life of the lease without the initial capital outlay. You make regular payments, and at the end of the term, you can purchase the asset, refinance the residual, or return it. This option helps manage cashflow while keeping your balance sheet lean.
Operating Lease
Ideal for businesses that want to stay current with technology or have regular upgrade cycles, an operating lease treats the equipment as a rental. At the end of the term, you simply return the equipment and upgrade to the latest models.
What Can You Finance?
The scope of asset acquisition through finance is broad. Here's what Queensland businesses commonly finance:
- Commercial vehicles - utes, vans, trucks, and trailers for your business operations
- Construction equipment - excavators, dozers, cranes, graders, and tractors
- Medical equipment - diagnostic machines, treatment equipment, and practice technology
- Hospitality equipment - commercial kitchens, refrigeration, and service equipment
- Office equipment - computers, phone systems, and furniture
- Factory machinery - production equipment and specialised machinery
- Technology equipment - servers, software systems, and IT infrastructure
Whether you're buying new equipment or upgrading existing equipment, the right finance structure can make all the difference.
Ready to get started?
Book a chat with a Finance & Mortgage Broker at Premium Finance Group Australia today.
The Benefits of Asset Finance for Your Business
Preserve Working Capital
One of the biggest advantages of asset finance is that it helps preserve working capital. Instead of paying tens or hundreds of thousands of dollars upfront, you can keep that cash in your business for operational expenses, emergencies, or other growth opportunities.
Tax Benefits
Depending on the finance structure you choose, there can be significant tax benefits. With a chattel mortgage, you may be able to claim depreciation on the asset and deduct the interest portion of your repayments. The GST treatment can also work in your favour, as you may be able to claim the GST component upfront rather than waiting to recover it gradually.
Predictable Cashflow Management
Fixed monthly repayments make budgeting straightforward. You know exactly what's going out each month, which helps with cashflow planning and financial forecasting.
Access to Latest Equipment
With an operating lease or regular upgrade cycle, your business can access the latest equipment without the commitment of ownership. This is particularly valuable in industries where technology evolves rapidly or where equipment efficiency impacts your bottom line.
Alternative Financing Structures
Beyond traditional asset finance, there are other options worth considering:
Vendor Finance
Some equipment suppliers offer vendor finance arrangements, where they provide the financing directly. While this can be convenient, it's worth comparing these offers with what we can access through our lending panel.
Dealer Finance
Similar to vendor finance, dealer finance is offered at the point of sale. Having a broker review these arrangements alongside other options ensures you're getting a structure that aligns with your business needs.
Asset Based Lending
For businesses with substantial equipment holdings, asset based lending uses your existing assets as collateral to secure additional funding for business growth or equipment acquisition.
Equipment Leasing
Whether it's a novated lease for an employee vehicle or commercial equipment leasing for your operations, leasing arrangements can provide flexibility and potential tax advantages.
Structuring Your Asset Finance
When considering a machinery purchase or equipment acquisition, several factors influence how you structure the finance:
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Loan Amount - How much do you need to borrow? This includes the equipment cost plus any accessories or installation.
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Interest Rate - Both fixed and variable rates are available depending on your preference and risk tolerance.
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Repayment Term - Typically aligned with the useful life of the asset, terms can range from one to seven years or more.
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Balloon Payment - A lump sum payment at the end of the term can reduce your regular repayments, though you'll need a strategy for managing this final payment.
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Residual Value - For leases, the residual value affects your payments and end-of-lease options.
Why Work With Premium Finance Group Australia?
As a Queensland-based business, we understand the unique needs of businesses across the state. From fleet finance for transport companies in Mackay to construction equipment finance for civil contractors in Cairns, we've helped businesses in every industry acquire the assets they need.
We work with multiple banks and lenders, which means we're not tied to a single product or institution. This gives us the flexibility to find finance solutions that genuinely work for your circumstances.
Our team takes the time to understand your business, your growth plans, and your cashflow situation. Whether you need one work vehicle or an entire fleet, specialised machinery for a unique application, or technology equipment to modernise your operations, we'll help structure the right solution.
Asset acquisition shouldn't be a barrier to business growth. With the right finance structure, you can access the equipment you need while preserving capital for other priorities. From commercial loans to equipment finance, we provide comprehensive support for Queensland businesses.
Ready to discuss your asset finance requirements? Call one of our team or book an appointment at a time that works for you. Let's talk about how asset finance can support your business goals.
