If your business is replacing a financed ute or van and the agreed trade-in allowance is more than the payout, you have positive equity to contribute to the next purchase. Carry it through the paperwork once. A clear changeover worksheet lets the dealer, existing lender and proposed new financier work from the same figures.
This is useful when your business records are current and you are planning an upgrade: you can compare the purchase package and funding structure before committing to either.
Put four separate amounts on the page
Collect the new vehicle's itemised invoice, the gross trade-in allowance, a written payout figure for the old loan and the fresh cash you intend to contribute. Ask the old lender which settlement date its payout covers and whether that figure includes any termination charges.
Keep the gross trade-in allowance separate from the amount left after paying the old loan. For a worked purchase example, assume:
- New van invoice, including all purchase charges in this example: $70,000.
- Agreed gross trade-in allowance for the old ute: $32,000.
- Old loan payout for the agreed settlement date: $14,000.
- Additional cash deposit from the business: $7,000.
The trade-in equity is $32,000 - $14,000 = $18,000.
The amount still to fund is $70,000 + $14,000 - $32,000 - $7,000 = $45,000. Equivalently, subtract the $18,000 equity and $7,000 cash deposit from the $70,000 purchase invoice.
These are invented purchase figures, not a lender quote or an approved borrowing amount. No additional financed fees or tax credits are included. Add any separately quoted amount to the worksheet before comparing finance proposals.
Ask what the dealer means by changeover
In the example, the new invoice less the gross trade-in is $38,000. That figure still leaves the $14,000 old loan to be accounted for. Once it is included, $52,000 remains before the new cash deposit, or $45,000 after it.
If the dealer's quoted changeover already includes the payout, adding the old loan again would overstate the funding requirement. If it excludes the payout, treating it as the complete amount would leave a shortfall. Ask for the calculation in writing instead of relying on the label.
Positive equity is a contribution to the transaction. Do not assume it will arrive as a cash payment in your business bank account. Confirm the agreed funds directions and who receives each payment.
When comparing two dealers, repeat this worksheet for each complete package. A larger trade-in allowance needs to be considered alongside the new vehicle price, included accessories and other charges.
Make the dates and security release agree
Put the expected handover date beside the payout expiry date. Ask who pays the old lender, when that payment happens, and what happens if delivery moves. Request an updated payout before finalising figures if the existing one no longer covers settlement.
Also ask who will confirm release of the old vehicle's security. The PPSR explains that the secured party needs to end its registration when its security interest ends. Keep the old loan settlement confirmation and agreed release process with the sale documents.
Record any fitout separately. If you plan to move shelving, a canopy or other equipment into the new vehicle, get written removal and installation quotes and an agreed description of what the dealer is taking in trade. Include the installation timetable in your handover plan.
Compare the funding after the purchase figures reconcile
Use the same confirmed amount, intended term and final-payment assumptions when asking for finance comparisons. Business.gov.au recommends checking charges, term, security and other conditions across business loan options. A lower regular repayment by itself does not reconcile a different purchase price or loan amount.
Keep tax assumptions separate from cash available for settlement. GST credits on a business vehicle purchase are conditional; ask your accountant to confirm the purchase and disposal treatment, relevant amounts and timing before counting any expected tax outcome in your cash contribution.
Our business equipment finance overview explains the broader funding service. For a replacement work vehicle, bring Loanseekers the new invoice, trade-in offer, dated payout, proposed cash deposit and intended handover date. Start with our business vehicle finance enquiry. Those documents give the finance discussion a clear purchase amount to work from.
If you are keeping the same asset and replacing its loan instead, the commercial asset refinance guide covers that different decision.
