Asset: 2007 Kenworth K104B Prime Mover
The Challenge A client with a strong background as a heavy vehicle driver (earning $120,000 p.a.) had the opportunity to step up as an owner-operator with a lucrative new contract. However, traditional lenders saw three major red flags:
- New Entity: The client’s business had no prior trading history.
- Asset Age: The truck would be over 20 years old by the end of the loan term, exceeding standard lender policies.
- Low Liquidity: The client had limited personal savings to put toward a significant upfront deposit.
Our Solution To mitigate the lender’s perceived risk, we looked beyond the balance sheet and structured a strategic application:
- Cash Flow Modelling: We prepared a comprehensive forecast, backed by a formal Worksource Letter, to prove the business could service the debt from day one.
- Creative Deposit Structuring: We negotiated a $12,000 interest-free loan from the client’s future principal contractor to satisfy equity requirements. We also secured a three-month repayment holiday on this private loan, allowing the client to stabilise his cash flow before taking on full debt servicing.
- Technical Negotiation: We leveraged a formal valuation to secure a loan term that perfectly balanced the asset’s older age with the client’s monthly cash flow needs.
The Outcome We secured the approval. The client successfully transitioned from a capped salary to a business generating $540,000+ p.a. in gross revenue, with immediate potential for further local work.
