Old Commercial Vehicle Finance: Its Meaning, Eligibility & Types

An old commercial vehicle loan is a financial solution that is welcomed by customers who earlier struggled to manage funds to purchase used vehicles for commercial purposes. A country's economy cannot function without commercial automobiles. Without them, companies would be unable to provide their clients with last-mile logistical services.

What is a Used Commercial Vehicle Finance?

Used commercial vehicle finance is the loan offered by vehicle financing companies to the borrower to purchase a second-hand yellow-plated vehicle for commercial use. This loan is an excellent option for customers who want to avoid the higher cost of buying a new commercial vehicle. So, businesses expanding their vehicle fleet or that want to replace their existing commercial vehicle can benefit from used commercial vehicle finance.




Used Commercial Vehicle Finance: Eligibility Criteria

Here are some typical eligibility requirements for used commercial vehicle financing:

Valid Commercial License:  A driving licence is an official document that the government of India issues to its citizens, attesting to the holder's competence to operate a motor vehicle in open spaces and on highways. After passing the written and practical exams, people are given this licence. Having two years of valid commercial license is necessary for availing a loan for a used commercial vehicle. 

Property Ownership:  Anyone can avail of a used car commercial loan against a collateral-like property. Delivered to customers that own either residential or commercial properties.

Possesion of More Than One Commercial Vehicle: This makes it easier for the lender to be certain that the borrower will be in a steady financial position to make payments on schedule. Being the owner of multiple commercial vehicles promotes confidence among lenders.

Types of Old Commercial Vehicle Loan

Following are a few types of commercial vehicle loans available:

Repurchase Loans

This type of loan is for customers who want to purchase a used commercial vehicle. The loan amount is decided on the total valuation of the vehicle, which is usually a certain percentage.  The commercial vehicle’s valuation is decided on the fair market value that is based on factors such as the vehicle’s age, condition, and mileage. Repurchase loans are excellent for customers who want to avoid the upfront cost of purchasing a commercial vehicle, as they can spread the cost over a longer period on EMIs.

Refinance Loans

Refinance loans are offered to businesses that already have existing vehicle loans and want to use the loan amount to fulfill their business needs. These loans can help businesses to utilize their cash flow in other important business functions and improve their financial flexibility.

Balance Transfers

A balance transfer is a process by which a customer can move their existing old commercial vehicle loan from one lender to another. The is usually preferred to take advantage of better offers and features by the new lender, such as lower interest rates, reduced EMIs, or longer repayment periods. Balance transfers are a good option for customers who want to improve their loan terms and reduce their financial burden.

Top-Up Loans

Top-up loans provide additional funding on top of an existing vehicle loan. This type of loan is designed for business owners and customers who need extra funds for their commercial vehicles. The loan runs simultaneously with the primary loan. However, the top-up loan is ideal for customers who need extra funds for repairs, maintenance, or other expenses related to their commercial vehicles.

A second-hand commercial vehicle loan is a cost-effective way to acquire yellow-plated vehicles for your business needs.

 

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