Trailer Finance Interest Rates: What Affects Your Rate?
There's no single trailer finance rate. Every offer is priced on the trailer, the borrower and the loan structure. Here's what moves the number.
The trailer
- Age and condition. Newer trailers usually attract better pricing, because their value is more predictable.
- Type and resale market. Mainstream transport trailers and popular recreational trailers are easier to resell than one-off builds, and lenders price that in.
- Dealer or private sale. Private sales can carry slightly higher pricing with some lenders.
You and your business
- Credit history. A clean credit file with a good repayment history gets the sharpest rates. Past defaults or late payments push rates up or narrow the lenders available.
- Time in business. Established ABNs with a solid trading record are seen as lower risk than new businesses.
- Documentation. Full doc applications often price better than low doc.
- Assets. Owning property can open up better pricing with some lenders, even when the property isn't used as security.
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Send an Enquiry →The loan structure
- Deposit. Borrowing less than the trailer's value lowers the lender's risk.
- Term. The term affects both the rate offered and how much interest you pay overall.
- Balloon. A balloon lowers your repayments, but you pay interest on that amount for the whole term.
- Loan size. Very small loans can carry higher rates because the lender's fixed costs are spread over less money.
Compare the total cost, not just the rate
Two offers with the same rate can cost different amounts once fees are included. When comparing, look at:
- Establishment and brokerage fees
- Monthly account-keeping fees
- Early payout or break costs
- The total of all repayments plus any balloon
For personal loans, lenders must show a comparison rate in their advertising, which bundles most standard fees into a single figure. Business loans don't have to, so ask for the total repayments and fees in writing.
Most asset finance is fixed rate. Your repayment is set for the whole term, which makes budgeting simpler. The trade-off is that paying out early can involve a cost, so check the payout terms if you might sell or upgrade early.
Want to see how different rates and terms change your repayment? Try the trailer repayment calculator.