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Van finance for company

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  • 01-04-2014 11:12pm
    #1
    scwazrh
    Registered Users Posts: 2,694 ✭✭✭


    Does anyone know if a company applies for finance for a van is it based on the companies finances or the directors?We need another van and leasing/ long term hire will cost 800 a month.We can buy a second hand but good condition van for 10K.

    It makes a lot more sense for us to buy the 2nd hand van but we need finance for it as we dont have 10k to take from the cashflow .The company is growing each year for the last 3 years and can afford repayments on the 10k which I estimate to be 330 per month for 3 yrs. My concern is that I as a director have poor credit as I returned a vehicle in 2009 from a sole trader business i had and the outstanding finance has not been cleared.The other director has a blemish free credit rating.

    So two questions really , if the company applies for van finance will directors credit rating be looked at ?, and secondly what other options are available for us to get a van on the road given my credit rating.

    Any advice appreciated..thanks


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    #2
    pedroeibar1
    Closed Accounts Posts: 5,108 ✭✭✭pedroeibar1


    Lenders/lessors look at repayment ability, then security. When lending/leasing to a company a background check on the directors would be the norm, so your credit history will pop up. If you have agreed a pay-off deal with the lender on your old sole trader account and if you have stuck to it, that will be taken into account. Not exactly a positive, but much less of a negative. If you have ignored it, it is a big negative.

    If the company applies for the loan/lease the lender/lessor will look for security and that could be a director's guarantee. If that happens it might be 'joint & several' which means that the lender/lessor will chase all, but the the wealthiest guy has the most to lose if the others have no assets.

    From what you write [and I assume you have been upfront with your co-director(s)] I suggest the company applies, if rejected then it is in the hands of the other directors.


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