Is this your first time buying a van or lorry for your business? Do you have questions you would like to ask but do not know who to turn to? If you answered Yes, then you are at the right place because we are about to put together the most frequently asked questions and answer them one by one. All these answers are based on the hundreds of commercial vehicle transactions and experience we have gained over the year.
Whether you are buying a van or lorry for the first time, we are sure the answers here will clear some of your doubts. So, without further delay, let’s dive into it!
Do I have to use a company name to buy a van or lorry?
Based on Land Transport Authority (LTA) requirements, a business or company is required to buy a commercial vehicle. So, if you are looking to buy a van or a lorry, yes you need a business or a company.
Can I use my personal name (NOT a company) to purchase a commercial vehicle?
If you are looking to buy a van or lorry, the answer is NO. The only 2 types of commercial vehicles that does not require a business or company is a double-cab pick-up or vehicles registered under the “Private Hire” scheme.
How much is the minimum down payment amount required to buy a van or lorry?
The good thing about buying a van or a lorry is that you are allowed to apply for a full loan. By doing so, the total out-of-pocket amount can be as low as just paying the first instalment and insurance premium for the first year.
For example, you applied for a full loan for the purchase of a Toyota Hiace van and the monthly instalment works out to be $950 per month. The insurance premium for the first year is $1,650. The total you need to fork out to drive back the van is $950 + $1,650 = $2,600.
What are the documents needed to apply for a loan to purchase a commercial vehicle?
For loans equals or lesser than 70% of the selling price, some but not all financial institutions do not need to see any supporting documents. However, if you are applying for a loan that is higher than that, the documents required will be as follows:
- Copy of NRIC both sides
- Latest 2 years personal notice of assessment (NOA/Income Tax)
- Latest 3 months company bank statements
My business or company is new, how do I provide 2 years of income tax assessment?
It is ok. The income on your tax assessment could be income generated from your previous or other business or employment. it does not have to be from this business or company. As long as you have your latest 2 years income tax assessment, we are still able to submit the application for you.
My business or company is new, how do I provide 3 months company bank statements?
If your company is new or your company does not have a bank account, you can use your latest 3 months personal bank statements to replace your company bank statements.
What if I do not have one or both of the income documents required?
If you do not have any one or even both of the income documents stated above, there is a high chance that a guarantor may be required. But again, it depends on situation. For this, we would recommend that we speak over the phone, through a video call or face to face so that we can have a better understanding and consult you with the best advice.
Do I have to place a deposit to apply for a loan?
Yes, a fully refundable deposit is required in order to try to apply for a loan. Typically, the deposit is at least $1,000 and it can be used to offset your balance payment (insurance or first instalment) once the loan is approved.
What happens to my deposit if the desired loan amount is not approved?
A deposit is fully refundable if the desired loan amount is NOT approved. Before you sign an agreement, you have to make sure that the dealer put this in writing on the agreement. Typically, dealers are very open to put this into writing. A sample statement to put on the agreement can be as follows:
“Deposit of “Amount” is 100% refundable if the loan amount of “Desired Amount” at the loan interest rate of “Agreed Interest Rate” for the tenure of “Agreed Tenure” years is NOT approved unless with the permission of “Your Name” to proceed with another loan arrangement in writing.”
Okay, I am ready to buy a van or lorry, what should I do next?
Now that you have decided on the make and model. Simply contact the dealer of your choice and go through a quick buying process:
- Sign agreement and place a fully refundable deposit
- Submit income documents to the dealer to apply for the loan
- Upon loan approval, receive insurance quotation and choose the preferred company
- Make the balance payment (first instalment + insurance premium + difference of selling price and loan amount – deposit)
- Collect your vehicle
Above are the top 10 questions that we have been asked by first time buyers over the years of selling vans and lorries. We hope we have covered all or if not, most of them. If there are still questions that you have in your mind, please feel free to let us know.
We can be contactable in various ways:
Facebook page: www.facebook.com/SingaporeVanDeals
Contact us form: http://sgautoconcierge.com/contact
Email Us: contact@sgautoconcierge.com
Whatsapp Us: 9136 6333
By letting us know what your questions are, not only can we help to resolve your doubts. We can also use the questions to update it here so that other first-time buyers can benefit too!
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Alternatively, do feel free to check out our blog for more contents and tips for vehicle owners including car insurance.
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