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commercial-hire-purchase-calculator

Commercial hire purchase calculator

How much could your business save with a commercial hire purchase?

A commercial hire purchase is an innovative finance product that enables a business to buy a car. It works by a financier purchasing a vehicle on behalf of the business, and then leasing it back to them over an agreed-upon period of time. At the end of this period, as long as the price of the vehicle and interest has been paid back in full, the business takes ownership of the car. A commercial hire purchase has a range of benefits for businesses, and one way to work out these benefits is to use a commercial hire purchase calculator.

Leasing Calculator

The calculator below is intended as a guide. Remember that each leasing provider and lender is different and it's always important to take into account the comparison rate and any fees and charges associated. This calculator is meant as a guide only and doesn't factor in GST.

NAB QuickBiz Loan Offer

NAB QuickBiz Loan Offer

from

12.95 % p.a.

fixed rate

  • Borrow up to $100,000
  • Get a response in 60 seconds
  • Sole traders, partnerships and companies can apply
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100% confidential application

NAB QuickBiz Loan Offer

The NAB QuickBiz Loan allows you to borrow up to $100,000 for your business needs. The loan is available for new or existing business needs and features no upfront fee and tax deductible interest repayments. Link your accounting software directly into the application.

  • Interest rate from: 12.95% p.a.
  • Interest rate type: Fixed
  • Application fee: $0
  • Minimum loan amount: $5,000
  • Maximum loan amount: $100,000
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Business Loan Alternatives

Rates last updated June 21st, 2018
Name Product Min Loan Amount Max. Loan Amount Loan Term Application Fee Product Description
NAB QuickBiz Loan
$5,000
$100,000
1 to 3 years
$0
An unsecured business loan from $5,000 that can be processed in 1 business day.
Valiant Finance Business Loan Broker
$5,000
$1,000,000
0.25 to 5 years
$0
A Small Business Lending Specialist from Valiant Finance can give you access to competitive business loans from over 60 lenders. Loans between $5,000 and $1 million are available. Request a call – your loan can be funded in 1 business day.
Moula Business Loan
$5,000
$250,000
0.5 to 2 years
$0
Small business loans of up to $250,000 approved and funded within 24 hours.
Transparent fees and rates. Note: Business must have been operating for at least 6 months and have monthly sales of at least $5,000.
Ferratum Business Loan
$2,000
$150,000
0.5 to 1.5 years
2.5% origination fee
Competitive business loans from $2,000 based on your business’ cash flow.
Prospa Business Loan
$5,000
$250,000
0.25 to 2 years
$0
Apply for up to $250,000 and receive your approved funds within one business day. Note: Businesses must have a turnover of more than $5,000 per month and be able to demonstrate 6 months of trading history.
OnDeck Business Loans
$10,000
$250,000
0.5 to 2 years
2.5% origination fee
Apply online for up to $250,000 with OnDeck and receive approved funds in one business day. Note: Minimum annual turnover of $100,000 and must be able to demonstrate 1 year of trading history.

Compare up to 4 providers

How do you use the commercial hire calculator?

Using the calculator is simple. You just enter your information into the relevant fields and the calculator will calculate your repayments on your car finance.

  • Loan amount. This is the amount you intend to borrow.
  • Term of the loan. The loan term is the amount of time agreed-upon by you and the financier. It’s generally between one and five years for fixed repayments or one and seven years for variable.
  • Residual (balloon) percentage. There is a percentage of the principal that is not paid for in monthly repayments, and is paid for at the end of the loan term. This is referred to as a residual or balloon percentage.
  • Residual (balloon) amount. This is the dollar amount that the residual percentage represents.
  • Interest rate. The rate of interest that you pay for the commercial hire purchase. This may be fixed or variable.
  • Repayment frequency. How often do you make repayments? Weekly, fortnightly or monthly?

Case study: John’s Delivery Service

TitleJohn is looking to purchase a new vehicle for his business, which is a delivery service. His cash flow won’t allow for him to buy a new vehicle, so he wants to know how much his repayments will be with a commercial hire purchase. Using the commercial hire purchase calculator, he enters the following amounts:

  • Loan amount: $10,000
  • Loan term: 3 years
  • Residual: 15% ($1,500)
  • Interest rate: 8% p.a.

After inputting those amounts he can see that his monthly repayments will be $274.53. Wanting to save some money, he sees what would happen if he made weekly repayments. Using the calculator he can see that his weekly repayments would be $63.35, which would be approximately $20 less a month than if he made monthly repayments.

Have more questions about using the commercial hire purchase calculator?

How can I use the calculator to reduce my repayments?

As outlined in the case study above, you can change the information you enter into the calculator and see if your repayments are reduced. By simple changing from monthly to weekly repayments John was able to reduce the amount he paid each month. You can also increase your residual payment, but keep in mind that this will still need to be paid at the end of the loan term.

How can I reduce the amount of interest I repay in my loan?

Reducing interest and reducing repayments are two entirely different things, though you can reduce the interest payable by lowering your principal. You can reduce your interest by lowering your loan term, increasing the frequency of your repayments or by budgeting to make additional repayments.

How accurate is the calculator?

The calculator is an approximation, but it is an accurate approximation as long as the information you put into it is correct. Keep in mind the calculator doesn’t take into account the fees or other costs that may come with your commercial hire purchase.

Do I need to supply any personal information to use the commercial hire purchase calculator?

No personal information is needed to use the CHP calculator. You only need the loan amount, the loan term, the interest rate, the repayment frequency, and the residual amount and percentage (if applicable).

Does the commercial hire purchase calculator guarantee my loan repayments?

No, the commercial hire purchase calculator will only provide you with a repayment amount based on the loan information you provide. It is up to the individual lender to decide what your actual loan and repayments will be.

Picture: Shutterstock

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