Vehicle Finance for a New Business

Vehicle Finance for a New Business: What You Need to Know

Starting a business is exciting, but it comes with challenges. One of the biggest? Getting the right vehicle finance. Whether you need a van for deliveries, a car for meetings, or a fleet to grow your operations, finding finance as a new business can feel impossible. Lenders can be hesitant, interest rates may seem high, and the process is often confusing.

But here’s the good news: You don’t have to do this alone. At First Oak Capital, we help new businesses secure the right finance options. Below, we’ll break down what you need to know so you can move forward with confidence.

Why is Vehicle Finance So Hard for a New Business?

When you’re new, lenders see risk. You might have a great business plan, but without trading history, banks and finance companies hesitate. Here’s why:

• No proven income – Lenders prefer businesses with a steady cash flow.
• No credit history – A brand-new business won’t have an established credit score.
• Industry risk – Some industries are seen as higher risk than others.

This doesn’t mean finance is out of reach—it just means you need the right approach.

What Are Your Vehicle Finance Options?

There isn’t a one-size-fits-all solution. Here are the most common options:

1. Hire Purchase (HP)

You pay an initial deposit, then fixed monthly payments. At the end of the agreement, you own the vehicle. This is great if you want ownership but need to spread the cost.

2. Finance Lease

You lease the vehicle and make regular payments, but ownership stays with the lender. At the end of the term, you can continue leasing or sell the vehicle on their behalf.

3. Business Contract Hire (BCH)

You rent the vehicle for a fixed period with a set mileage allowance. You never own it, but you avoid depreciation worries.

4. Operating Lease

Similar to BCH but more flexible, often with maintenance included. Ideal for businesses that need vehicles short-term.

5. Unsecured Business Loan

If you prefer, you can take out a loan to buy a vehicle outright. This avoids restrictions but may come with higher interest rates. Each option has pros and cons. The best choice depends on your business needs, cash flow, and long-term plans.

Our job at First Oak Capital is to help assess your situation and advise on the best options and the right lenders to approach to increase your chances of approval at the best rate. 

How to Improve Your Chances of Approval

Getting finance as a new business isn’t impossible, but preparation is key. Here’s how to strengthen your application:

1. Show a Clear Business Plan

Lenders want to see you’ve thought ahead. A solid business plan with financial projections helps build confidence. You can also seek support from your local UK Chambers of Commerce for networking opportunities and expert business advice. Lenders want to see you’ve thought ahead. A solid business plan with financial projections helps build confidence.

2. Have a Healthy Deposit

A larger deposit reduces the risk for lenders and can help secure better rates.

3. Improve Your Credit Score

Even if your business is new, your personal credit score matters. Pay bills on time and reduce outstanding debts.

4. Offer a Personal Guarantee

Some lenders may approve you faster if you’re willing to personally guarantee the loan.

5. Work with a Specialist Broker

Instead of applying blindly, work with a broker (like us!) who knows which lenders are open to new businesses.

Common Mistakes to Avoid

New businesses often make mistakes that hurt their chances of getting vehicle finance. Here’s what NOT to do:

• Applying to too many lenders at once – Multiple hard credit checks can lower your score.
• Ignoring affordability – Taking on a monthly payment you can’t sustain could damage your business.
• Not checking hidden fees – Some finance agreements have extra charges you might not expect.
• Waiting until the last minute – Plan ahead to avoid rushed decisions.

Lenders worry about risk, but with the right approach, you can improve your chances of approval. Understanding different finance options, preparing a solid business plan, and working with a specialist broker like us can make all the difference.

Get Expert Help Today

Finding the right vehicle finance for a new business can feel overwhelming, but you don’t have to go through it alone. At First Oak Capital, we specialise in helping new businesses secure finance that works for them.

How We Can Help

We understand the struggles of securing finance when your business is just getting started. That’s why we take a hands-on approach to find solutions that work for you. Here’s what we do:

• Expert Matching – We connect you with lenders who are open to working with new businesses.
• Application Support – We help prepare your application so it stands the best chance of approval.
• Access to Exclusive Deals – We work with lenders who offer competitive rates that might not be available elsewhere.
• Quick and Clear Communication – Unlike other brokers, we won’t ignore you or leave you waiting.
• Ongoing Support – Even after you’ve secured finance, we’re here to help with any future needs.

We won’t ignore you like some brokers do. We’ll guide you through the process, answer your questions, and help you get the best possible deal.

Call us today or complete the form on our website to get started. Let’s get you on the road to success. At First Oak Capital, we specialise in helping new businesses secure finance that works for them.

We won’t ignore you like some brokers do. We’ll guide you through the process, answer your questions, and help you get the best possible deal.