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There are several ways to get a ute, van or tipper on the road without paying the full purchase price upfront. The challenge is working out what each option actually means for your business.
Who owns the vehicle? What costs are included? How long are you committed? Can you own it at the end?
Those questions matter more than the finance jargon.
Tradiespec’s Rent-to-Own product shares some features with traditional finance, leasing and rental, but works differently from each. Below, we’ll break down the common pathways to acquiring a vehicle for work use and how they compare to our Rent-to-Own service.
Key Points
- Chattel mortgage: Your business owns the vehicle from the start and repays the lender over time.
- Finance lease: The finance provider owns the vehicle while your business pays to use it.
- Operating lease: Generally focused on using the vehicle rather than owning it.
- Tradiespec Rent-to-Own: Tradiespec owns the vehicle during the agreement, but major vehicle costs are bundled into the weekly payment, and you can work towards ownership.
- Minimum commitment: Rent-to-Own has a 24-month minimum within a 60-month ownership pathway.
- No balloon payment at the end: Complete the full Rent-to-Own term and the vehicle can be transferred to you for only a small fee, without a large balloon or residual payment due at the end.
How the Options Compare
Swipe across to view the full table.
| Criteria | Chattel Mortgage | Finance Lease | Operating Lease | Tradiespec Rent-to-Own |
| Own the vehicle during the agreement? | Yes | No | No | No |
| Can ownership be the end result? | Already owned | Depends on agreement | Generally not the main purpose | Yes, after completing the full term |
| End-of-term payment | May include a balloon payment, depending on the agreement | Commonly includes a residual value as part of the lease structure | Vehicle is generally returned at the end, subject to the agreement | No large balloon or residual payment. Small transfer fee after completing the full term |
| Major on-road costs bundled? | Generally arranged separately | Depends on agreement | Depends on agreement | Yes |
| Typical commitment | Agreed finance term | Agreed lease term | Agreed lease term | 24-month minimum within a 60-month ownership pathway |
| Return option | Subject to finance agreement | Subject to lease agreement | Usually tied to lease terms | After 24 months, subject to the applicable early exit fee |
| Trade-specific setup | Separate from the finance itself | Depends on provider | Depends on provider | Tradiespec can configure the vehicle for trade use |
Chattel Mortgage
A chattel mortgage is a common way for Aussie businesses to finance a vehicle.
Your business buys the vehicle using funds from a lender and owns it from the beginning. The lender takes security over the vehicle until the finance is repaid. That means the vehicle becomes a business asset from day one.
You will generally manage the ongoing costs separately, including:
- Registration
- Insurance
- Servicing
- Maintenance
- Tyres
- Roadside assistance
Some chattel mortgages can also be structured with a balloon payment at the end. This can reduce the regular repayments by deferring part of the amount until the finance term finishes.
Finance Lease
With a finance lease, a finance provider owns the vehicle, and your business pays to use it for an agreed period.
You do not generally own the vehicle while the lease is running.
Finance leases commonly include a residual value as part of the agreement. This can help reduce the regular lease payments, but the residual still needs to be dealt with at the end of the term. The exact options will depend on the lease agreement.
Running costs can also vary between providers. Some arrangements package certain costs together, while others leave them with the customer.
Operating Lease
An operating lease is generally used by businesses that want access to a vehicle for an agreed period without making ownership the main objective.
The provider retains ownership, and the customer pays to use the vehicle under the terms of the lease.
At the end of the agreement, the vehicle will commonly be returned to the provider.
This can suit businesses that prefer to use and replace vehicles rather than work towards owning them long term.
Where Does Tradiespec Rent-to-Own Fit?
Tradiespec Rent-to-Own does not fit neatly into one traditional finance category.
Tradiespec owns the vehicle while the agreement is running, so you are not purchasing the asset from day one as you would under a chattel mortgage.
At the same time, Rent-to-Own is not simply about using a vehicle and returning it at the end.
The current structure has a 60-month ownership pathway with a minimum commitment of 24 months. After the first 24 months, you can return the vehicle subject to the applicable early exit fee. Continue through the full 60-month term, and Tradiespec can transfer the vehicle to you for a small transfer fee.
There is no large balloon or residual payment to deal with at the end of the Rent-to-Own term. That is an important difference when comparing options, because the regular payment only tells part of the story.
What’s Included in the Payments?
For the Rent-to-Own service, there is also more included in the weekly payment than the vehicle itself.
Current inclusions cover:
- Registration and CTP
- Comprehensive insurance
- Scheduled servicing and maintenance
- Nationwide roadside assistance
- An additional set of four tyres when the original set requires replacement
- Like-for-like accident replacement cover, subject to the agreement terms
You can see the current inclusions on our Rent-to-Own page.
For a trade business, bundling those expenses can make vehicle costs easier to plan for than managing several separate bills throughout the year.
The Vehicle Can Be Spec’d for the Work Too
How you pay for a vehicle matters, but so does what turns up on day one.
A standard ute or van may still need a fitout before it can properly replace your current work vehicle.
Tradiespec can configure vehicles around the job. Depending on the vehicle and your requirements, that can include:
- Toolboxes
- Ladder racks
- Tow bars
- Trays
- Roof racks
- Van shelving
- Ladder holders
- Other approved accessories
A number of Tradiespec vehicles already include practical trade equipment as part of their listed specifications. Depending on the model, that can include a tray, toolbox, ladder racks, tow bars, and other specs.
You can explore the current Tradiespec vehicle range to see the available vehicle and fitout options.
A Tradiespec Single Cab Ford Ranger with ladder rack, toolbox and tow bar installed
Tradie Tip: Start with what the vehicle needs to do each day. Tools, ladders, materials, towing requirements and crew size can all affect which vehicle and fitout will work best.
What Should You Compare Before Choosing?
The regular payment is only one part of comparing work vehicle options.
Look at:
- Who owns the vehicle
- What is included in the regular payment
- What costs you need to manage separately
- Whether there is a balloon, residual or other amount to deal with at the end
- How long you are committed
- What happens if you need to exit early
- Whether you want to own the vehicle eventually
- What it will take to get the vehicle ready for work
Looking at the full structure gives you a better idea of what you are paying for along the way and what, if anything, remains at the end.
For tradies who want a work-ready vehicle, bundled running costs and a path towards ownership without buying the vehicle upfront, Tradiespec Rent-to-Own provides another option to compare.
Get in touch with our team today to send through an application (ABN required).
Tradiespec Expert
At Tradiespec, our mission is to help tradies across Australia with insights and advice to drive your business forward. Whether it’s tips on vehicle selection, how to manage your fleet or insurance information, we’ve got you covered.
