Second-Hand Commercial Vehicle Finance: An Affordable Solution

Editorial Team

April 3, 2023

Small and Medium businesses often require frequent use of vehicles. However, many times due to financial crunch, businesses fail to invest in the vehicles as the other needs are to be taken care of, such as inventory management, staff payroll, and such. And so, many businesses are unable to operate at their full capacity.

But there’s nothing to worry about, as there are second hand commercial vehicle loan options to equip SMEs with the finance to fund their aspirations and expand their business. But how can you avail second hand commercial vehicle loan, what is eligibility, and what documents are required? How to find out which one is best among the plethora of options? Read ahead to find out before you make a decision!

What is the Second Hand Commercial Vehicle Finance?

Second hand commercial vehicle finance empowers businesses to buy vehicles for commercial purposes. Many financial institutions around the country offer used commercial vehicle loans to small and medium-sized businesses. At times, these used commercial vehicle loans are customized to meet the needs of loan applicants. Once the loan is granted, the applicant will have to pay the dues every month, as well as the interest rates.

Commercial Vehicle Loan Eligibility

Here is the used commercial vehicle loan eligibility-

Minimum one year of ownership of at least two commercial vehicles
Financial stability in the living town, village, or city
Applicants without any prior experience owning a commercial vehicle will have to name a relative or friend who works in the same business
Credit history of highlighting the worthiness

Now that we are aware of commercial vehicle loan eligibility, let us learn about the key benefits of this loan!

Key Benefits of Second Hand Commercial Vehicle Loan

There are numerous benefits of second hand commercial vehicle loans. For small and medium enterprises, it is similar to a boon to run the business at full capacity! Here are some of the key benefits-

Affordability: Second hand commercial vehicle loan is generally more affordable than financing for new commercial vehicles. This is because used vehicles have already undergone significant depreciation, reducing their overall value and making them more affordable to finance.
Flexibility: Second hand commercial vehicle loan offers greater flexibility than purchasing a vehicle outright. With financing, businesses and individuals can choose from various repayment options and loan terms, allowing them to tailor the financing to their specific needs and budget.
Faster turnaround: Second hand commercial vehicle loan often has a quicker turnaround time than financing for new vehicles. This means that businesses and individuals can get their vehicles on the road more quickly, helping to improve their bottom line and meet their transportation needs.
Lower risk: Second hand commercial vehicle loan can be less risky than financing for new vehicles. Since the vehicle has already been on the road for some time, any issues or defects will be identified and addressed, reducing the risk of unexpected maintenance or repair costs.
Improved cash flow: Financing a second hand commercial vehicle can help improve cash flow for businesses and individuals. Rather than paying for the vehicle upfront, they can spread the cost out over time, making it easier to manage their finances and invest in other areas of their business or personal life.
Access to better quality vehicles: The second hand commercial vehicle loan can give businesses and individuals access to better quality vehicles than they could afford outright. With financing, they can choose from a wider range of vehicles that better suit their needs and budget.

Key Points to Consider When Picking a Used Commercial Vehicle Loan

Interest rates: One of the most important factors to consider when choosing a used commercial vehicle loan is the interest rate. A higher interest rate will mean that you end up paying more over the life of the loan, so it is essential to shop around and find a loan with a competitive interest rate.

Loan term: The loan term is the length of time over which you will be paying off the loan. A longer loan term will mean smaller monthly repayments but a higher overall cost due to interest charges. Consider your budget and financial situation to determine the best loan term for you.

Down payment: Some lenders may require a down payment on a used commercial vehicle loan. This is a lump sum payment made at the time of purchase that reduces the amount you need to finance. Consider whether you have the funds available for a down payment and how much you can afford to put down.

Repayment schedule: The repayment schedule will determine how often you repay your loan. This could be monthly, biweekly, or weekly. Consider which plan works best for your budget and cash flow.

Fees: Review any fees or charges associated with the loan, such as application fees, late payment fees, or prepayment penalties. These can add up over time and increase the overall cost of the loan.

Lender reputation: Research the lender you are considering and check their reputation and customer reviews. Look for a transparent and responsive lender to your questions and concerns.

Vehicle inspection: When financing a used commercial vehicle, it must be inspected by a trusted mechanic to ensure that it is in good condition and worth the investment.

Conclusion

It is mandatory to apply for the second hand commercial vehicle loan from a trustworthy place. HDFC Bank offers a range of financing options for second-hand commercial vehicles, and there are several reasons why someone might want to apply for a loan from HDFC Bank:

Lower interest rates
Flexible loan terms
Easy application process
Wide range of loan amounts
Different vehicle brands are accepted
Customisable EMI plan to suit your needs
Bank branches available in different parts of the county for easy and smooth access

Now that you are well aware of all the facilities offered by HDFC Bank, apply for the loan today and expand your business!