The Complete Guide to Business Auto Loans

Updated on March 31, 2021
Advertiser Disclosure

Let's Get Started

See Loan Options
In This Guide

    What Is a Business Auto Loan?

    A business auto loan, sometimes called a commercial auto loan, is a specific form of equipment financing that allows you to access low-cost capital to purchase cars or trucks—which then function as collateral for the loan itself. This self-collateralizing setup makes it much easier to find a business auto loan without personal guarantee requirements.

    Overall, business auto loans are very similar to consumer auto loans—and although the rates and terms will vary based on the individual lender, these business loans are generally very affordable and accessible for businesses of all shapes and sizes.

    In this guide, we’ll break down everything you need to know about business auto loans, starting with the top commercial auto lenders.

    The Best Business Auto Loans

    If you’re thinking that a business auto loan might be a suitable financing solution, you’ll want to compare the best lenders to find the one that meets your unique needs.

    Although there are a variety of lenders out there that can offer this form of equipment financing, you might start your search with these top six options:

    1. Wells Fargo

    Best for: Highly qualified borrowers; ideal rates and terms

    If you’re looking for the most affordable business auto loan, you’ll always want to start with a bank, like Wells Fargo.

    Although you might be able to find a Bank of America or Capital One business auto loan, the Wells Fargo commercial equipment financing program is one of the best out there—offering options for trucks, semi-trailers, specialty vehicles, buses and motorcoaches, and more.

    Overall, the specifics for a Wells Fargo business auto loan will vary based on the individual program and your business’s qualifications, however, you’ll generally find that they can offer:

    • Loan purpose: Up to 100% vehicle financing to purchase new or used equipment or upgrade existing equipment
    • Terms: One to seven years
    • Interest rates: Competitive fixed or floating interest rates

    Of all the business auto loan options on our list, Wells Fargo will likely be one of the most affordable, but also one of the hardest to qualify for and slowest to fund.

    In general, you’ll need at least two years in business, strong annual revenue, and a good credit score (700+) to qualify for this bank-based business loan.

    2. Balboa Capital

    Best for: Faster funding than a bank

    Next, if you need business auto loan financing faster than what a bank like Wells Fargo can offer, you might consider Balboa Capital as one of your best options. As an alternative lender, they offer a quick and easy online-based application process with same-day funding.

    Balboa offers business auto loans through their equipment financing program, where you can use a loan to purchase new or used vehicles, as well as other types of equipment.

    • Terms: Balboa Capital offers business auto loans ranging from $3,000 to $250,000 with terms as long as five years.
    • Rates: Although Balboa doesn’t specify their rates online, you’ll likely find that they start around 9% to 10% and vary based on your qualifications.
    • Requirements: To qualify for a business auto loan from Balboa, you’ll need to have at least one year in business, a minimum of $100,000 in annual revenue, and a “decent” FICO credit score.

    Therefore, even though Balboa might charge slightly higher interest rates than a bank, you’ll find that they offer a streamlined application process and more lenient requirements.

    3. Currency Finance

    Best for: Streamlined funding; borrowers with average credit

    Similar to Balboa, if you’re looking for a larger business auto loan with a faster time to funding, you might consider Currency Finance as a top option.

    Currency provides business auto loans ranging in size from $5,000 up to $500,000. Additionally, although Currency’s larger loan amounts can be a draw, they excel at financing smaller loans—offering a simple and fast application process for loans under $150,000 and funding in as little as 24 hours.

    To this point, even though larger business auto loans will require greater documentation and be slower to fund, you’ll still find that Currency’s process will be easier and faster than working with a bank.

    • Terms: Currency Finance offers auto loans with terms up to six years.
    • Rates: Interest rates start as low as 6%.
    • Requirements: To qualify for a business auto loan from Currency, you’ll need a minimum credit score of 625, two years in business, and at least $120,000 in annual revenue.

    4. Crest Capital

    Best for: Larger loan amounts; low interest rates from an online lender

    Next on our list of the top business auto loan providers is Crest Capital. This lender has one of the best reputations in the industry and offers commercial auto loans ranging from $5,000 to $1 million.

    • Terms: Crest Capital auto financing is available in terms ranging from two to seven years.
    • Rates: Interest rates from Crest Capital can start as low as 5%.
    • Requirements: Unfortunately, Crest isn’t specific about their requirements on their website. Instead, they simply mention that you should have a solid credit history, be healthy and profitable, and have some time in business—as they don’t finance pure startups.

    Overall, Crest offers both vehicle financing and vehicle leases, with a number of loan structures within both of these options. It’s worth noting, however, that although Crest offers the full range of vehicle financing solutions, they do not finance passenger vehicles or trucks for owner-operators.

    Moreover, if you’re looking for a business auto loan of $250,000 or less, you’ll be able to apply through Crest’s “application-only” program, which requires minimal documentation; you can often receive approval the same day.

    For larger loans, though, you’ll need to submit a more standard business loan application with financial statements, tax returns, and other requested documents. Both of these applications can be submitted online.

    All in all, Crest will be able to fund you faster than a bank, but might not be quite as fast as Currency or Balboa.

    5. National Funding

    Best for: Auto loans for startups and borrowers with bad credit

    Through National Funding’s equipment financing program, you can access a business auto loan or a lease for cars, delivery vans, commercial trucks, trailers, fleet vehicles, and more. This lender allows you to finance new or pre-owned equipment up to $150,000 and offers a simple online application with approval in as little as 24 hours.

    • Terms: National Funding offers terms of two to five years with a monthly repayment schedule.
    • Rates: This lender does not provide interest rates on their website—they do, however, offer a “lowest lease payment guarantee” and do not require down payments or collateral. With the lowest lease payment guarantee, National Funding states that if you can find an equivalent offer with a lower lease payment rate, they’ll pay you $1,000.
    • Requirements: To qualify for a business auto loan from National Funding, you only need six months in business and a credit score over 575.

    Of all the options on our list, National Funding has the most flexible requirements—making them a great option for startup businesses and business owners with bad credit.

    6. CIT

    Best for: Fast funding and affordable starting rates from an online lender

    Finally, last on our list of the best business auto loan options is CIT, formerly Direct Capital.

    CIT is another online lender that offers a host of financing options, including vehicle and equipment financing. If you work with CIT, you can qualify for a business auto loan of up to $500,000.

    CIT offers both loan and leasing options, with flexible term lengths and repayment options to meet your business’s needs. In addition, these loans can fund as fast as one day.

    • Terms: Repayment terms from CIT range from six months to six years.
    • Rates: Interest rates on this financing starts as low as 5.49%.
    • Requirements: Unfortunately, CIT doesn’t provide any information regarding qualifications for their equipment financing products on their website. If you’re interested in their auto loans, we’d recommend reaching out to their customer service team for more details before submitting your application.
    See Your Auto Loan Options

    How Do Business Auto Loans Work?

    So, now that you have an idea of the best small business lenders offering loans for commercial vehicles, let’s break down some of the fundamentals to better understand how this form of financing works.

    Once again, as we saw above, many of these details will vary from lender to lender, but generally, here’s what you can expect when looking for a business auto loan.


    As with most forms of equipment financing, business auto loans will give you access to some of the most affordable interest rates out there, because the vehicle itself will act as collateral for the funding.

    On the whole, business auto loan interest rates can fall as low 3.89% if you’re accessing funding through a bank—whether Capital One, Bank of America, or, like we discussed, Wells Fargo.

    With alternative lenders, on the other hand, you’ll usually see interest rates start a little higher, around 8%, due to the speed and more lenient requirements associated with these lenders.

    Of course, it’s important to remember that business loan interest rates can range, and these are just starting rates. Generally, the better qualifications you have, the lower interest rates you can receive—so you’ll want to keep this in mind when applying for a business auto loan.


    The amount you can receive for a business auto loan can range from as low as $5,000 to as high as $2 million, or more.

    Additionally, most lenders will be able to offer up to 100% of the value of the vehicle you plan on purchasing with the proceeds. As we saw above, most commercial auto loan lenders will put a dollar amount cap on their loans, but this will fluctuate based on which lender you choose to work with.

    Repayment Terms and Structure

    Overall, most business auto loan financing will be structured similar to any business term loan, with repayments made on a monthly basis.

    This being said, however, you may see some variation, like balloon-payment loans, so you’ll want to understand exactly how any loan works before agreeing to work with the lender offering it.

    Additionally, due to the higher loan amounts associated with this type of financing, you’ll find that terms are on the longer side—ranging anywhere from one to seven years.

    Business Auto Loans vs. Business Auto Leasing

    As we saw with some of our top lenders, many times you have the option of choosing between a business auto loan vs. a business auto lease.

    Although both will have their respective merits, it’s important to note that with a lease, you won’t ever own the car or truck.

    As a result, you won’t be able to consider any vehicle you lease an asset when calculating your business’s worth. Meanwhile, a business auto loan will allow you to own your car or truck, while also paying down the cost gradually.

    However, at the end of the lease, you do have the option to pay off the balance and own the vehicle or enter into a lease for another vehicle. This might make more sense if you can’t qualify for a business auto loan, or if you don’t want to be stuck with equipment that will soon be outdated.

    When to Get a Business Auto Loan

    If you want to keep the vehicle for an extended period of time, a business auto loan is a good option.

    With an auto loan, you can rack up the mileage, and don’t have to worry as much about wear and tear on the car.

    Additionally, business auto loans are usually cheaper than leases in the long run.

    When to Get a Business Auto Lease

    On the other hand, an auto lease is a good option if you want to upgrade every few years to a newer model, or if you don’t plan on racking up a large number of miles.

    However, leases are usually more expensive than loans, especially since you’ll have to pay more if you want to buy the vehicle when the lease expires.

    How to Apply for a Business Auto Loan

    Now that you know a little bit about how small business auto loans work and the best lenders that offer them, let’s break down how to actually get this type of business financing.

    When it comes down to it, you can follow these simple steps:

    1. Find your vehicle.

    The first thing you’ll need to do is find the car, truck, or other vehicle that you want to purchase for your business.

    As you’re comparing different options, you’ll want to consider whether the vehicle is new or used, how old it is, what condition it’s in, what maintenance will look like, and of course, how much it will cost to finance.

    Most lenders will want to see a quote as part of your financing application, so once you’ve found the vehicle that you want, you’ll want to make sure to request that information from the dealer.

    2. Evaluate your qualifications.

    Next, you’ll want to determine what type of commercial auto loan you will be able to qualify for. Overall, because business auto loans are a form of self-secured financing, they’ll have more manageable requirements than their unsecured alternatives.

    Additionally, finding a business auto loan with no personal guarantee will be much easier than it would be with other types of loans, if you’re concerned about putting your personal assets at risk.

    In many cases, you should be able to qualify for auto financing if you have a credit score of 600+, at least one year in business, and at least $100,000 in annual revenue. Ultimately, however, business auto loan requirements will vary from lender to lender—and as we discussed above, banks will typically have the strictest requirements, whereas alternative lenders will be more lenient.

    That said, it’s helpful to evaluate where your business stands before choosing a lender and moving on to the application process.

    3. Choose a lender and submit an application.

    Once you have your vehicle quote and a better sense of where your business might qualify, you’re ready to choose a lender and submit your application. You might start with any of the lenders on our list above, or you might opt to work with a lender you have a preexisting relationship with.

    In any case, you’ll find that the specific application process will vary from lender to lender—again, banks will have more intensive processes and will be slower to fund, whereas online lenders will likely offer more streamlined applications and faster funding.

    Overall, you should expect to provide your potential lender with your vehicle quote, financial statements, bank statements, tax returns, among other documentation.

    4. Review your offer and get your funding.

    After you’ve submitted an application and received an offer, you’ll want to be sure to review it thoroughly—perhaps even consulting an accountant or attorney—to ensure that you understand all the terms, conditions, and fine print.

    Then, once you’re ready to sign, you’ll be able to return your business loan agreement to the lender, receive your funding, and get the vehicle your business needs.

    The Bottom Line

    At the end of the day, if you’re interested in seeking capital for purchasing an automobile—a car, truck, bus, or RV—for your business, then it’s definitely worth considering a business auto loan.

    As we’ve discussed, these loans often don’t require additional collateral and can offer long terms and affordable interest rates.

    On the other hand, however, if you think the vehicle might be out-of-date before your repayment period is over, you might look into leasing as an alternative to this form of financing.

    Frequently Asked Questions

    Meredith Wood
    GM, New Markets at NerdWallet

    Meredith Wood

    Meredith Wood is the founding editor of the Fundera Ledger and a GM at NerdWallet.

    Meredith launched the Fundera Ledger in 2014. She has specialized in financial advice for small business owners for almost a decade. Meredith is frequently sought out for her expertise in small business lending and financial management.

    Read Full Author Bio