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Need a commercial vehicle loan for your small business? Learn more about our top options for auto loans.
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For many small businesses, vehicles are a vital part of operations. Whether it’s to deliver products to customers, drive sales, or commute from one location to another, businesses need reliable, dependable vehicles.
However, most small businesses don’t have the capital to purchase a vehicle with cash. A lack of capital is an even bigger problem when a business needs to buy multiple vehicles. The solution: obtain a business auto loan.
Read on to find out more about the different types of business auto loans, when you should consider a loan, and what to expect during the loan process. And if you’re looking to finance something a little heavier, you may want to see our picks for trucking business loans.
Learn More About Our Top Picks
| Company | Best For | Next StepsBest For |
|---|---|---|
BusinessLoans.com
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National Funding
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SmartBiz
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Wells Fargo Business Loans
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Bank of America Business Loans & Lines of Credit
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| Show Fewer Options |
Read more below to learn why we chose these options.
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The best auto lenders for small business offer accommodating terms and repayment schedules as well as competitive rates. The following lenders offer business and commercial auto loans that are suitable for a variety of small business needs.
| Borrowing Amounts | Loans | Leases | Minimum Time In Business | |
|---|---|---|---|---|
| BusinessLoans.com | $5,000 - $3 million | 6 months | ||
| National Funding | Up to $500,000 | 6 months | ||
| SmartBiz | Varies by product | 2 years | ||
| Wells Fargo Business Loans | Varies by loan type | 2 years | ||
| Bank of America Business Loans & Lines of Credit | Varies by product | 2 years |
Pros
Cons
As a loan aggregator, BusinessLoans.com allows borrowers to apply to its entire network of lenders with a single application. Beyond being an overall strong lender that we rated 4 out of 5 stars, Businessloans.com can save applicants time and effort. Even if five out of six lenders in the Businessloans.com network turn you down, you're still getting at least one offer with your application. Many of these loans are well-suited for purchasing vehicles.
BusinessLoans.com is also pretty lenient when it comes to credit ratings -- there's no minimum to apply.
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Pros
Cons
National Funding is one of the longer-running lenders in the alternative lending market, which we gave high ranks to in the areas of breadth and availability of services.
While much of National Funding's business is oriented towards short-term loans, it also offers equipment loans and leases that are well-suited to vehicle purchases. Best of all, there's no down payment, which can be a huge advantage for new businesses.
Get Started With National Funding
Pros
Cons
If you meet SBA borrower qualifications, SmartBiz is a great place to find a loan to purchase a commercial vehicle. SmartBiz works with SBA-approved banks to streamline the SBA loan application process, allowing business owners to apply online with minimal hassle.
Compared to other online lenders, SmartBiz takes a little longer because of the SBA paperwork and processing requirements. Still, using SmartBiz is faster than securing a traditional SBA loan from a bank. SmartBiz is also a highly reputable company that discloses all its terms and fees and doesn't tack on sneaky hidden fees or terms.
Pros
Cons
Online lenders can offer a lot of speed and convenience to borrowers, but when it comes to excellent rates, banks still have the upper hand. Wells Fargo stands out from many of its competitors by being more accessible to small businesses when it comes to lending.
While Wells Fargo doesn't have the best public reputation, we did give the bank high marks for pricing and transparency. Further, its lines of credit can allow you to have a ready source of cash on hand while you shop around for the vehicle you need. If you prefer terms loans, Wells Fargo can also offer you SBA 7(a) and 504 loans.
Get Started With Wells Fargo Business Loans
Pros
Cons
Sometimes you just want a traditional auto loan with competitive rates. If you run a well-established business with excellent credit and need a loan for a vehicle weighing less than 2.5 tons, Bank of America's auto loans can be an excellent financing option. And if you do need to purchase a heavier vehicle, you can do so with a Bank of America equipment loan or lease instead.
We gave Bank of America high marks for its breadth of services and affordability, both of which make it a strong choice for business car loans.
Get Started With Bank of America Business Loans & Lines of Credit
We spend hours researching and evaluating each business loan and funding product that we review at Merchant Maverick, placing special emphasis on key characteristics to generate our ratings.
When rating lenders and funding providers, we use a 31-point rubric that looks at rates and fees, services, eligibility requirements, application, sales and advertising transparency, customer service, and user reviews. We weigh each section differently to calculate the total star rating. This rubric is applied to traditional term loans, as well as short-term loans, start-up loans, lines of credit, online lending products, merchant cash advances, and equipment financing products.
Each section is further broken down into granular, weighted subsections, in which we examine specific attributes like terms lengths, conditions of repayment, credit score and revenue requirements, ease of application, length of time to funding, the ethics involved in promoting the lending product, customer support, and the overall reputation of the lender or funding provider.
Read more about how we rate small business lenders.
Commercial (business) auto loans and personal (consumer) auto loans have similar structures as far as terms and fees. However, there are a few key differences between these two loan types.
Key Differences Between Commercial & Consumer Auto Loans:
Typically, an established business that requires a vehicle will benefit from financing that vehicle through a commercial vehicle loan. If you have a small, newer business but good personal credit, you may have better luck securing a consumer car loan. Just make sure you consider all of the liability, insurance, and tax implications.
When evaluating funding options for business vehicles, there are two major options to consider: commercial auto loans and commercial auto leases. A business owner needs to understand the differences between the two before starting the application process.
Commercial vehicle loans are used to buy the vehicle outright. The borrower pays a set amount each month for the entire length of the term. This payment applies to the loan’s principal amount as well as interest paid to the lender for advancing the money.
The other type of financing is leasing. Leasing is more like a long-term rental. A lessee (in this case, the business owner) agrees to make monthly payments on the vehicle. The lease period will be for a set period, such as three years; during that time, the lessee can only drive the car for a set number of miles per year. The vehicle must be well taken care of and not damaged while in use.
You can read more about these differences in our loans versus leases article.
Once you find a business vehicle you want to purchase, you can start the process of obtaining a loan. To secure a business auto loan, you’ll need to gather your necessary business documentation, select a lender, and ideally do some comparison shopping before signing on the dotted line.
60 months is a typical repayment term for most auto loans. Most small business loans also require you to sign a personal guarantee as collateral.
A down payment may also be required. Though no down payment options exist, it’s best to put something down to lower your monthly payments and reduce your likelihood of having an “upside-down” loan (when you owe more money on the vehicle than what it’s worth).
For a rundown on what the process is like, check out our feature on how business loans work.
The paperwork you need to submit to get a business auto loan will vary depending on the lender, but you might have to submit documents such as:
Auto loans can be a useful way for a business to finance vehicles needed for everyday operations. While current interest rates and prices are high, with a little legwork you can still find a good deal from the best small business lenders.
Looking for other options for financing equipment? Check out our best equipment financing companies.
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Our expert reviewers found BusinessLoans.com to have a quick and easy application process alongside excellent support and guidance for borrowers.
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The vendors that appear on this list were chosen by subject matter experts on the basis of product quality, wide usage and availability, and positive reputation.
Merchant Maverick’s ratings are editorial in nature, and are not aggregated from user reviews. Each staff reviewer at Merchant Maverick is a subject matter expert with experience researching, testing, and evaluating small business software and services. The rating of this company or service is based on the author’s expert opinion and analysis of the product, and assessed and seconded by another subject matter expert on staff before publication. Merchant Maverick’s ratings are not influenced by affiliate partnerships.
Our unbiased reviews and content are supported in part by affiliate partnerships, and we adhere to strict guidelines to preserve editorial integrity. The editorial content on this page is not provided by any of the companies mentioned and has not been reviewed, approved or otherwise endorsed by any of these entities. Opinions expressed here are author’s alone.
Our expert reviewers found BusinessLoans.com to have a quick and easy application process alongside excellent support and guidance for borrowers.
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