Many businesses require reliable transportation to ensure smooth and efficient operations. However, leasing or purchasing vehicles outright can be prohibitively expensive and end up consuming a large portion of a business’s budget. That’s why many businesses turn to specialized business auto loans, which are designed to help them finance the purchase of vehicles without putting too much strain on their financial resources.
Whether you're bouncing back financially and looking for the best bad credit auto loans, or simply searching for the best car loan rates available, there are a dizzying amount of factors to consider. To make the decision-making process easier, we’ve examined the loan offerings of dozens of lenders to bring you a list of the five best business auto loans for 2023. Read on to find out which option best suits your business’s needs.
Our Top Picks for Best Business Auto Loans
- Crest Capital - Best for Small Businesses
- SBG Funding - Best for Business Owners With Bad Credit
- Bank of America - Most Competitive Rates
- Balboa Capital - Best Business Fleet Auto Loan
- Ally Bank - Best Business Auto Loan for Heavy-Duty Trucks
Best Business Auto Loans Reviews
- Finances new, used and third-party sales
- Little to no restrictions on vehicles purchased
- Application-only approval process available for loans under $250,000
- Requires two years of business history
- Doesn't finance "for hire" vehicles (Uber, Lyft, taxis and similar)
Why we chose it: Crest Capital is our top pick for small business auto loans because of its competitive rates, loose restrictions on vehicle purchases and application-only approval process for loans under $250,000.
For loans under $250,000, Crest Capital offers an application-only approval process. This means you don’t have to provide financial statements or other detailed documents such as tax returns and account balances. Instead, potential borrowers provide details relating to the desired vehicle and vendor and answer a few basic questions about their business and credit history.
Although Crest Capital will want to know about your company’s credit health, the company claims to also focus on the industry your business is in, the amount of time it's been operating and any existing principal credit (for example, whether the company president owns a home).
While loans under $250,000 use a simplified application process, those over $250,000 will require more detailed financial statements. Loans under $250,000 are available with 24 to 72 months repayment terms while loans over $250,000 can spread out up to 84 months.
Unlike many other auto loan providers that have various restrictions, Crest Capital offers loans for vehicles regardless of their age or mileage. It also provides loans for almost all types of vehicles, even specialized vehicles such as cranes, hearses, drill rigs, concrete mixing trucks, fire trucks, ambulances and boom trucks.
No minimum annual revenue requirement is listed and Crest Capital is willing to finance new, used and third-party sales. The company does typically require at least two years in business, meaning new startups may not qualify. Additionally, it doesn't finance “for hire” vehicles (Uber, Lyft, taxis and similar) nor owner/operator or transportation company tractor trailers.
Customers report generally positive experiences with Crest Capital, which has received an "A+" rating from the BBB and currently holds a 4.82 out of 5-star customer review rating on the platform.
- Low minimum credit score requirement of 500
- Approval decisions in under 24 hours and same-day funding available
- 85% approval rate
- Only 6 months of business history required
- Excellent customer reviews
- Requires at least $10,000 in monthly revenue
- No information about fees listed on website
Why we chose it: For companies and business owners with less-than-perfect credit, SBG Funding's minimum credit score requirement makes it a great option.
What really stands out about SBG Funding is its low credit score requirement of 500, meaning even business owners with bad credit have a chance at securing the funds they need. With an approval rate of 85%, approval decisions within 24 hours and same-day funding, SBG provides an excellent option for those looking for fast financing with lenient qualification requirements.
In addition to these eligibility criteria, applicants will have to show six months of business history as well as the business's four most recent bank statements. There is no prepayment penalty and repayment terms range from one to seven years.
There is a minimum revenue requirement of $10,000 per month, which may leave some small businesses ineligible. There is also little to no information regarding fees on the website, requiring interested borrowers to go through the application process to find out more.
SBG is accredited by the BBB and holds an "A+" rating from the organization. It has a 5 out of 5-star customer review on the platform and has extremely positive reviews on other popular third-party review sites. Customers have praised the company for its fast and reliable service, as well as its high approval rate.
- Low fixed interest rates
- Ability to lock in rate for 30 days
- Interest rate discount between 0.25%-0.5% available for Preferred Rewards for Business members
- Restrictions on car age and mileage
- Shortest loan repayment term is 42 months
- Minimum vehicle value of $10,000
Why we chose it: With some of the lowest fixed interest rates and the ability to lock in rates for 30 days, Bank of America offers some of the most competitive business car loan rates in the market.
Bank of America's business auto loan product offers consistently competitive rates and includes the ability to lock in rates for 30 days, giving borrowers more time to shop around for the vehicle they want without worrying about rising interest rates. Bank of America also offers a 0.25%-0.5% rate discount to Preferred Rewards for Business members, which adds to the deal's value.
The company's business car loans have repayment terms between 42 and 72 months, so those looking for shorter repayment terms will have to look elsewhere.
The auto loan also comes with some restrictions. Vehicles cannot be older than five years old, be worth less than $10,000, have more than 75,000 miles or weigh more than 2.5 tons. You can finance vehicles that weigh over 2.5 tons through the company's equipment financing product.
Bank of America has received accreditation from the BBB as well as an "A+" rating. Although the company has mixed reviews on its BBB page and popular review sites, many of these ratings seem related to the company's banking services, not its loan products. This makes it difficult to make a definitive judgment on the satisfaction of the company's business auto loan customers.
- Application-only approval process available for loans up to $500,000
- Low minimum credit score requirement of 620
- One-hour approval decisions during regular business hours with same-day funding available
- Only 1 year of business history required
- No information about fees listed on website
- $100,000 minimum annual revenue requirement
- $100,000 minimum annual revenue requirement
Why we chose it: Balboa Capital offers a fast application-only approval process of up to $500,000 with quick funding and few restrictions on the type of vehicle you can finance, making it a great choice for businesses looking to quickly finance a fleet of work vehicles.
Balboa Capital has a low minimum credit score requirement of 620 and only requires one year of business history to qualify for its business vehicle financing. It also claims that its application-only process can take as little as one hour and same-day funding may even be available depending on what time you submit the application.
Balboa Capital has the highest application-only loan limit of any of the companies listed here, with a maximum loan amount of up to $500,000. Loans for more than that amount require additional documentation and will involve a longer approval process. There is also a $100,000 minimum annual revenue requirement for the application-only process.
The company does not list any information about fees or interest rates on its website, making it difficult to compare the cost of a loan from Balboa Capital to other lenders. Its financing loans come in repayment terms ranging between 24 and 60 months.
The company is accredited by the BBB and has an A+ rating. It has a 1 out of 5-star customer satisfaction rating on the website, although this is from very few reviews. Other popular review sites show a mixed opinion of Balboa Capital with some customers praising the company for its ability to provide funding in a timely manner and others complaining of lackluster customer service.
- Offers financing for heavy-duty trucks up to Class 8 (vehicles over 33,000 lb)
- Finances vehicle modifications such as adding towing equipment and mobility lifts
- Flexible term options up to 75 months
- Financing available for vehicles up to 6 model years old with up to 700,000 miles
- Offers business auto loans in business name only without personal guarantee for qualified businesses
- No listed minimum eligibility requirements
- No information available on fees, interest rates or maximum loan amount
Why we chose it: Ally Bank is the only lender we found that explicitly lists heavy-duty trucks up to Class 8 in its business automotive financing offerings.
Class 8 trucks weigh more than 33,000 pounds and are designed for long-haul transportation, making them ideal for trucking companies. They are also exceptionally expensive and complex investments that typically require specialized financing. Ally Bank’s business financing loan for heavy-duty trucks comes with repayment terms up to 75 months, allowing businesses to spread their payments out over a longer period of time.
The lender offers financing for vehicle modifications such as adding towing equipment and mobility lifts, as well as financing for vehicles up to six years old with up to 700,000 miles. It also offers business auto loans in business name only. This means that owners of qualified businesses can secure financing without having to commit to a personal guarantee that holds them liable if the loan defaults.
Unfortunately, Ally Bank does not provide detailed information online on eligibility requirements, fees, maximum loan amounts or interest rates. This makes it difficult to compare the lender to other potential options. The lender is accredited with the BBB and has an "A-" rating. Although it has a 1.16 out of 5-star rating, it has successfully closed out over 250 customer complaints over the past 12 months. This demonstrates an encouraging level of responsiveness to customer satisfaction and complaints.
Other business auto loans we considered
Aside from the companies listed above, we also reviewed some additional lenders for business auto loans that may be worth considering.
- Flexible loan terms up to 72 months
- Finances both new and used vehicles
- Requires 3 years of business history
- Maximum loan of $250,000
- Can only apply in person or by phone
- Extensive documentation required
PNC Bank offers leases and auto loans for business owners who need to purchase or refinance commercial vehicles. Loans are available for both new and used vehicles, with terms up to 72 months. Unfortunately, PNC requires three years of business history and extensive documentation such as financial statements, business tax ID number, annual sales, number of employees and various pieces of information from the business owner. In addition, the maximum loan amount is only $250,000 and you can only apply in person or by phone.
- Specializes in financing commercial vehicles
- Same-day approval and 24-hour funding
- Financing for vehicles up to 7 years old
- Requires 2 years of business history
- Minimum credit score requirement of 675
- Minimum financed amount of $15,000
Truck Lenders USA specializes in financing commercial trucks, trailers and construction equipment. The company offers same-day approval and 24-hour funding for applicants who qualify. Truck Lenders USA finances vehicles up to seven years old but requires a minimum credit score of 675 and two years of business history. The minimum financed amount is $15,000. When compared to similar lenders, the loan offerings from Truck Lenders USA didn't quite make the cut.
- Accepts applicants with credit scores of 575 and up
- Only requires 6 months of business history
- Application decisions in as little as 24 hours
- Only offers auto and equipment loans up to $150,000
- Requires a minimum of $250,000 in annual revenue
National Funding is an online lender offering both general small business loans and specialized equipment and auto loans. The company has relatively lenient credit requirements, accepting applicants with a score of 575 or higher, only requires six months of business history and can provide a decision in as little as 24 hours. While the company's loose credit requirements are attractive, its maximum auto loan amount of $150,000 and minimum annual revenue requirement of $250,000 left it out of our top picks.
Business Auto Loans Guide
Parsing through the vast amount of options for business auto loans can be overwhelming. The following guide provides a comprehensive overview of the most important points to consider when searching for the best business auto loans as well as what to expect when applying for one.
What is a business auto loan?
An auto loan for a business is a type of loan that finances the purchase of vehicles for use in a company's operations. These loans are typically secured by the vehicle purchased, meaning that the lender has the right to repossess the vehicle if payments are not made. Once the loan is approved, the business can purchase the vehicle with the loan funds and use it for operations.
How do business auto loans work?
Car loans for business use work similarly to personal auto loans. The business will typically need to provide proof of creditworthiness and income in order to qualify for a loan. The lender will then assess the risk of lending the funds and determine an interest rate to offer. Depending on the loan amount and risk level, the term of repayment can range from a few months to several years. In some cases, borrowers may be able to get preapproved for a car loan, allowing them to shop for cars within their approved loan amount.
How to get a business auto loan
There are several steps to securing a business auto loan from setting a budget to comparing loan offers from multiple lenders. The following section lays out each step in detail.
1. Set a budget for your business vehicle purchase
The first step to getting a business auto loan is to consider how much you can afford to borrow for the vehicle and what fits within your business’s budget. Make sure to include any taxes and fees to get a more accurate picture of the total purchase cost. You will also need to factor in the additional expenses of owning a vehicle such as insurance, maintenance and registration fees.
2. Check both your personal and business credit score
Before applying for a loan, it’s important to check both your personal and business credit score. The better the credit rating of the borrower, the better the terms and rates they can get on a loan. In some cases, it may even be better to apply for the loan under your personal credit profile than your business’s.
3. Decide on which vehicle you'd like to purchase
Once you have established a budget and checked your credit score, it’s time to decide on which vehicle you want to purchase. Consider the size, make, model and features to make sure you’re getting the right car for your business needs.
4. Get a business auto loan pre-approval from multiple lenders
Pre-approvals are important to help you get an idea of what kind of loan terms you can get from lenders and what vehicles you can purchase.
5. Compare loan interest rates, repayment terms and the fine print
As with any loan, it’s important to read the fine print and compare loan interest rates, repayment terms and other features before signing. Make sure you understand the terms of the loan and any potential penalties that may come with it before signing on the dotted line.
6. Submit an application to your preferred lender
When you’ve found the right loan for your business, it’s time to apply. The process typically involves submitting documents such as bank statements and tax returns as well as providing a detailed business plan.
7. Await approval and sign your loan documents
Finally, you’ll need to await approval from the lender and sign your loan documents if approved. Once you do, the lender will provide you with the funds to purchase your chosen vehicle.
Business Auto Loans FAQs
What are business auto loans without personal guarantee?
Can I transfer my car loan to my business?
Can you deduct car loan payments for business from your taxable income?
You can deduct expenses related to business vehicles like lease payments, insurance and maintenance from your taxable income. There are actually two ways to deduct your car loan payments for business. You can choose either the standard mileage rate or the actual expense method. The former is simpler and requires you to track your total mileage and multiply it by the IRS-set rate.
The latter involves tracking all expenses related to the car throughout its lifetime and subtracting them from the purchase price. However, these deductions are subject to certain limitations set by the IRS. It's important to consult with an accountant before taking any deductions related to your car loan payments.
How We Chose the Best Business Auto Loans
To evaluate the best business auto loans, we considered many factors from loan terms and fees to the application process and customer reviews. The following are some of the most important criteria we used to determine the best business auto loans:
- Loan terms and repayment options: We considered the length of loan terms and repayment options associated with each lender. We gave lenders that offered more flexible terms and repayment options higher rankings.
- Fees: We examined the fees associated with each loan. We attempted to find lenders that didn’t charge excessive fees or hidden costs.
- Application process: We assessed how easy and straightforward the application process was. This includes the number of documents needed, the time to complete the application and the process for approval.
- Approval times and funding speed: We looked at how quickly an application could be approved and funded.
- Customer reviews: We read reviews from customers who had taken out business auto loans with each lender. Reading through reviews provided insight into the overall customer experience.
- Types of vehicles funded: We looked for lenders that would finance a variety of vehicles. This includes cars, trucks, vans, passenger vehicles and other types of commercial automobiles.
- Loan limits: We considered the maximum loan amount.
- Eligibility requirements: We examined the minimum eligibility requirements for each lender such as credit scores and years in business.