Quick answer

With rent to own truck finance, you choose the truck and the rent-to-own company purchases it. You then rent the truck under an agreed contract with buy-out options along the way and, depending on the structure, a pathway to eventually own it.

  • Get approved before choosing or paying a deposit on a truck
  • Deposits are often around 10% or roughly one month of rent, but no-deposit situations can occur
  • The rent-to-own company owns the truck during the rental period
  • Insurance, servicing and repairs are generally your responsibility
  • After building trading history, refinancing may provide a cheaper long-term option

Rent to own truck finance can be useful when you need a truck to start earning income but you do not yet qualify for a traditional commercial loan.

We see this most often with new owner-drivers, subcontractors and businesses that are just getting started. You need the truck to generate the income, but the lender wants trading history before it will finance the truck. It is the classic chicken-and-egg problem.

Get approved before you choose the truck

Our preference is to get pre-approved first, then go shopping. If you find the truck first, approval can take longer than expected and you may miss out.

More importantly, do not pay a dealer deposit until the finance is approved and you understand the repayments, rental term and buy-out structure. We regularly see people pay a deposit first and then hit a problem with approval or discover the structure is not what they expected.

How rent to own works

You choose the truck and the rent-to-own company purchases it. You then sign a rental agreement and make the agreed payments.

The rent-to-own company owns the truck during the rental period. Many structures run on 12-month rolling terms with a buy-out figure at each 12-month point. Depending on the provider and contract, there may eventually be a nominal purchase amount, sometimes as little as $1, to transfer ownership to you.

The exact payments, buy-out figures and term vary, so these should be clear before you sign.

Deposit, insurance and maintenance

Deposits are commonly around 10% of the truck price or roughly one month of rent, although some transactions may have no deposit, particularly where the asset is already owned by the finance company.

Insurance, servicing, tyres, repairs and general maintenance are usually your responsibility. If the truck breaks down, you generally need to deal with the repair even though the rent-to-own company technically owns the vehicle.

Where rent to own makes sense

Rent to own is usually most useful when the truck solves an immediate business problem. For example, you may have years of transport experience and confirmed subcontracting work, but a brand-new ABN means a mainstream lender will not finance the truck yet.

Without the truck you cannot start the work. Without the work you cannot build the trading history needed for cheaper finance.

That is where rent to own can make sense as a stepping stone.

Rent now, refinance later

One common strategy is to use rent to own to get started, build around 12 months of trading history and then review whether the buy-out amount can be refinanced into a more conventional commercial finance product.

There is no guarantee that refinancing will be available, but after 12 months the business may have bank statements, BAS history, turnover and a track record of making its vehicle payments. That can present a very different application from day one.

Before you sign

  • Get approved before paying a dealer deposit
  • Understand the weekly or monthly payment
  • Check the 12-month and later buy-out figures
  • Confirm when ownership can transfer to you
  • Check who pays insurance, registration and repairs
  • Ask whether the truck can be bought out or refinanced early
Practical takeaway

Rent to own is rarely the cheapest way to fund a truck. Its value is that it can get an income-producing vehicle into the business when conventional finance is not yet available. Use it to solve the immediate problem, understand the structure properly, and review your options once the business has a track record.

Frequently asked questions

Yes. You need an active ABN to apply for rent to own truck finance.

Yes. You will generally need to be registered for GST for rent to own truck finance.

Yes. A new ABN can qualify for rent to own truck finance. The amount you are looking to fund is important. A reasonable $20,000 to $30,000 truck can often be relatively straightforward, while a new business looking for a $200,000 truck will need to substantiate how it expects to generate enough income to make the payments.

You choose the truck and, once approved, the rent-to-own company purchases it. You then rent the truck under an agreed contract with scheduled payments and buy-out options.

No. The rent-to-own company owns the truck during the rental period. The agreement provides buy-out options along the way and, depending on the structure, a pathway to eventually own the truck.

We commonly see deposits around 10% of the truck price or roughly one month of rent. Some transactions may have no deposit, particularly where the asset is already owned by the finance company.

We recommend getting approved first. Make sure you understand the rental payment and buy-out structure before paying a dealer deposit, as we regularly see people commit to a truck before discovering an issue with the finance.

You do. Insurance, servicing, maintenance and repairs are generally your responsibility during the rental period, even though the rent-to-own company owns the truck.

Yes, subject to qualifying for conventional finance at that point. This can be a good strategy for a new business: use rent to own to get started, build 12 months of trading history and then look at refinancing the buy-out into a potentially cheaper commercial finance product.