Vehicle finance frequently asked questions

What is Commercial Asset Finance?

Commercial Asset Finance is available to micro and small businesses to finance business equipment and vehicles.

For most small businesses, access to reasonable equipment and vehicle funding is a vital issue. Liberty Financial has the capability to consider a much broader range of customers than mainstream financiers. It is our broader, more inclusive, approach that makes Liberty unique.

Liberty Financial offers Commercial Hire Purchase and Chattel Mortgage products for the purchase of new or used cars, vans, utes and small trucks.

What is the difference between Commercial Hire Purchase (CHP) and Chattel Mortgage (CM)?

Commercial Hire Purchase (CHP) – is a facility whereby the financier purchases and owns the asset and allows the borrower the right to possess and use it in return for regular payments (a hire arrangement). After all payments have been made the hirer (the borrower) takes over ownership of the asset.

Chattel Mortgage (CM) – is a facility whereby the customer is the owner of the asset but borrows against the value of the asset, i.e. the lender has a mortgage over the asset being financed. After all payments have been made the mortgage is discharged. You may be able to claim the GST included in the purchase price of the goods. Please seek advice from your accountant.

What kind of vehicle can I finance?

Finance is available for passenger and commercial vehicles up to 7.5 tonne, including cars, utilities, vans and people movers.

Prime movers and vehicles for interstate haulage are not currently available under Liberty Commercial Asset Finance.

If purchasing a taxi, applicants should hold the appropriate taxi (vehicle) licence.

The following vehicle brands are not acceptable for finance: ASIA, Corsa Special Vehicle, Daihatsu, Lada, Seat, Ssangyong, Tata, Morgan and TVR.

What products do you offer?

Liberty offers a range of products to suit a variety of needs and circumstances:

Star (full doc) – is offered to customers who are PAYG (pay as you go) or have been self-employed for a minimum of 12 months and who are able to provide full verification of income. PAYG applicants can apply for a commercial loan if the vehicle is used predominately for work purposes e.g. Real Estate Agents, Business Managers etc. and where the customer receives a car allowance or reimbursement for vehicle expenses.

Nova (low doc) – is available to applicants who partially or wholly relied on self-employment for at least 24 months and who do not wish to provide accountant prepared financials.

Start Up – is available for recently self-employed applicants who can demonstrate experience in their industry e.g. a plumber who starts their own plumbing business.

Product features Include:

Loan terms of 2 to 5 years
Interest is fixed for the term of the loan
Repayments are Principal and Interest
Balloon/Residual payments are available
Repayment options of monthly, fortnightly or weekly. These can be made in advance or arrears
Repayment method via direct debit only
Maximum loan size is $120,000, minimum loan size is $10,000
Guarantors are acceptable where the borrower is a company or trust
Once an applicant receives their GST payment back from the ATO after purchasing the vehicle, they may add this payment to their loan as an additional payment.

What documentation do I need to provide?

Star – Fully verified income for businesses and self employed applicants. Self employed applicants must have a minimum of 12 months as self employed and be able to verify income from tax return and accompanying Notice of Assessment, supported by bank statements. PAYG applicants applying for business-use vehicles must be able to provide payslips and employment contracts. Income may include PAYG including second jobs and car allowance with varying minimum employment terms. Fully verified income from self employment is also acceptable. Restrictions apply to casual income.

Nova – Low doc. Available to self employed applicants who have been self employed (ABN registered) for a minimum of 2 years. Applicants to provide a stated annual average pre-tax profit (based over 2 years) evidenced through the latest 3 months’ bank statements.

Start Up – A newly established business needs to provide fully verified income based on previous established PAYG employment in the same industry. Income is verified from tax return and accompanying Notice of Assessment, supported by bank statements. Start Up businesses are also required to provide copies of relevant contracts.

How do we calculate the vehicle value?

Glass’s Guide is utilised to value vehicles. Trade Value is applied to used vehicles and Recommended Retail Price for new vehicles.

How do we calculate the interest rate and Loan to Value Ratio (LVR)?

Loan to Value Ratio is the percentage that the customer is borrowing in comparison to the value of the vehicle.

The applicant’s past credit history, vehicle age and vehicle value determine the interest rate and maximum LVR.

Can I purchase a commercial vehicle through a private sale?

Vehicles must be purchased through a licensed motor dealer.

I have a Learner’s Permit. Can I finance a vehicle through Liberty Financial?

No, a valid Driver Licence (suitable for the vehicle) showing current residential address is required for all applicants (excepting companies).

I am under 23 years old. Can I get finance through Liberty Financial?

Applicants under 23 years of age need to have good stability in employment and at least 6 month’s proven payment history on a regular commitment e.g. rent, credit card, loan or another regular payment.

What exceptions apply?

We will not provide finance in the following circumstances:

To people in remote locations
To applicants that reside in caravans, hotels/motels
For motor bikes, boats or caravans
To undischarged or discharged bankrupts less than 6 months
To repeat credit offenders e.g. bankrupt twice, defaults after bankruptcy
For high performance vehicles for under 23 year olds
For certain vehicle brands i.e. ASIA, Corsa Special Vehicles, Daihatsu, Lada, Seat, Ssangyong, Tata, Morgan and TVR.
Where there is undisclosed or inconsistent information
Where there is evidence of problem gambling or illegal activity
In the absence of customer benefit
To non-residents
To people with unpaid repossessions
To casual or self-employed couriers

Do I need to have proof of Comprehensive Insurance?

Comprehensive vehicle insurance is required in all instances and can be paid 12 months in advance or under a pay by the month or Insurance Premium Funding Plan. Evidence of payment of first month required for all pay by the month policies.

What happens when I apply for finance through Liberty Financial?

Liberty Financial checks the information you provide. If all is okay we approve the loan and loan documentation is printed for you to sign. Once all documentation is received by us and has been verified, we pay the dealer. You will be contacted and told when you can pick up your vehicle.

What should I do if I can’t make a loan repayment?

You should make sure that you have enough money in your bank account to cover payments when they are due. You will be charged fees if you do not make a payment on time or if a Direct Debit fails. If at any time your circumstances change, please ring our Customer Service Department on 13 11 80 to discuss other options.

Remember, you cannot sell the vehicle until you have repaid your loan in full without the express approval of Liberty Financial.