With economists divided over the Reserve Bank’s next move and the August rate potentially being held firm, business owners across Australia are reassessing their loan structures.
While mortgage holders wait for a decision, thousands of small businesses continue to make repayments on vehicle and asset loans that no longer fit their needs. From florists running delivery vans to tradespeople financing tools and café owners investing in kitchen upgrades, the right lending structure can make or break cash flow.
“Refinancing doesn’t have to be complicated,” says Nathan Hanna, Director of Hanna Lending Services. “It’s often just a smarter version of what you’re already doing, but with more benefit and less drag.”
Here are five signs it might be time to refinance your car, van or equipment loan.
1. Your repayments are slowing you down
If your loan is biting into working capital or forcing you to hold off on stock, staffing or upgrades, you’re not alone. Refinancing can reduce your monthly repayments, stretch your loan over a more manageable term, or consolidate several repayments into one.
“Every dollar tied up in interest or outdated fees is a dollar you’re not using to grow,” Hanna says.
Even minor adjustments to your repayment structure could give you the buffer you need to operate more confidently.
2. Your business has changed but your loan hasn’t
You might’ve taken out dealer finance when you were just starting up. But what happens when you’ve grown? A florist who once managed one van may now run three. A tradie might be hiring staff and expanding his service area. A café owner may have added catering or delivery operations.
“We see business owners still on entry-level finance even though their business has evolved,” Hanna says. “That’s like driving a workhorse on a racetrack. You need finance that keeps up.”
3. You’re stuck on a high interest rate
If you locked in a loan two or three years ago, there’s a good chance your rate isn’t competitive anymore. Even if rates aren’t dropping quickly, specialist lenders may offer lower options based on your improved credit history or turnover.
“Most people don’t know they can refinance mid-loan,” says Hanna. “You don’t have to finish one loan to start a smarter one.”
Even a few points off your rate can add up to thousands saved over the term of the loan.
4. You’re missing out on tax deductions
Using your mortgage or a personal loan to finance a business vehicle or equipment can limit your ability to claim interest or depreciation. If the asset is for business use, it should be structured accordingly.
“Come tax time, structure matters,” Hanna says. “With the right setup, like a chattel mortgage or commercial lease, you may be able to claim interest, depreciation or even repayments.”
If you missed out on deductions this EOFY, now is the time to fix your structure before next year rolls around.
5. Your lender isn’t working for you anymore
Some lenders treat business finance like a numbers game. There’s little room for strategy, and even less for flexibility. If you’ve been met with generic products or long delays, it could be time for a change.
“The right broker will align your finance with your goals, not just hand you a product and disappear,” Hanna says.
A tailored refinance can help you access better terms, faster approvals and lenders who actually understand your industry.
What refinancing could actually save you
Let’s say you’re repaying $60,000 in equipment finance at 9.5% over five years. Refinancing to 7.2% could save you over $4,000 in interest alone, not to mention the monthly cash flow improvements.
“We get it. You took the first loan you could to get the wheels turning. But now your business is bringing in real cash and that leaky finance setup is slowing you down. Let’s tighten it up and set you up to scale, not stall,” Hanna says.
Don’t wait for the RBA. Adjust now.
With rate cuts still uncertain and cost pressures rising, Hanna says waiting could cost more than acting.
“Small business owners aren’t ignoring their finances, they’re just flat out keeping things running,” Hanna says. “But the Reserve Bank won’t lighten your cash flow. Taking control of your loan structure now is one of the smartest, easiest wins. It’s not more admin. It’s less pressure, more margin, and a setup that supports the business you’re actually running today.”
