How Start-Up Businesses Can Secure Van Finance Without a Trading History
If you are a new business looking to purchase a van but have no trading history yet, securing van finance can seem daunting. Lenders typically assess creditworthiness based on business performance, but start-ups can still access finance by exploring specific options and preparing accordingly.
Understanding the Challenge
Traditional business van finance lenders prefer applicants with established financial records. Without trading history, it is harder to demonstrate the ability to repay, which can limit borrowing options or require higher deposits.
Practical Options for Van Finance Start-Ups
1. Personal Guarantees or Joint Applications
Some lenders may allow directors or owners to provide a personal guarantee or apply jointly. This helps mitigate risk by relying partly on your personal credit and financial standing.
2. Larger Deposits
Putting down a higher deposit can improve your chances. Larger deposits reduce the lending amount and show commitment.
3. Hire Purchase or Lease Purchase Agreements
These finance types may be available to start-ups, subject to lender criteria. They offer structured repayment plans that can suit new businesses. (Note: Van Finance Company offers brokerage services for such finance types.)
4. Utilize a Broker with Access to Specialist Lenders
A finance broker with a wide lender panel, like Van Finance Company, can match you with lenders accustomed to working with businesses lacking trading history.
5. Provide Business Plans and Cash Flow Projections
Presenting detailed plans and projected cash flow demonstrates a well-thought-out strategy and ability to meet repayments.
6. Consider Inventory or Asset-Based Lending
Using business assets as security may open finance opportunities.
7. Look into Rent2Buy as an Alternative
Though not a finance product, Van Finance Company's Rent2Buy scheme offers flexible renting with the option to own later. However, this product operates differently and has distinct terms and conditions. Vehicles under Rent2Buy are collection only from Southampton, so review the agreement carefully before proceeding.
What Van Finance Company Can Do
• We assist individuals, self-employed, and limited companies with finance applications even if trading history is limited.
• We access the largest UK panel of lenders, including those specializing in loans to start-ups and businesses with poor or no credit history.
• We guide you through eligibility requirements and application steps to maximise your chances of approval.
Important Considerations
• Approval depends on multiple factors including affordability, credit checks, and lending criteria.
• You may be required to provide a deposit including VAT.
• Finance approval times can vary; limited company applications can sometimes receive same-day decisions.
Frequently Asked Questions
Q: Can start-up businesses with no trading history get van finance?
A: Yes, but it may require additional steps such as higher deposits, personal guarantees, or use of specialist lenders accessed via a finance broker.
Q: Do I need to be personally liable for the finance?
A: Often directors provide personal guarantees or joint applications are recommended to support the finance application.
Q: How can I improve my chances of approval as a start-up?
A: Prepare a clear business plan, provide cash flow forecasts, offer a larger deposit, and use experienced finance brokers.
Q: What alternatives are there if I can’t get traditional finance?
A: Consider the Rent2Buy scheme, which offers flexible renting with the option to own, but note it is not finance and has specific collection terms.
Q: Does Van Finance Company provide free delivery?
A: Free UK delivery to home or work is offered for finance vehicle purchases, but Rent2Buy vehicles must be collected from Southampton.
Summary
Start-up businesses without a trading history face challenges in securing traditional van finance but can explore options like higher deposits, personal guarantees, hiring specialist brokers, and reviewing alternative schemes like Rent2Buy. Van Finance Company provides tailored support to navigate these options and increase your chances of obtaining suitable van finance.
View available vans and apply when you are ready.
Browse current Van Finance Company stock or start an application when you have found the right vehicle.