The practical answer
A balloon can reduce regular instalments by leaving a larger final payment, but the business needs a credible way to meet it.
Ask for the balloon amount, total payable and any conditions in writing. Estimate the van’s future value conservatively using anticipated age, mileage and condition, rather than assuming a sale will clear the balance.
Unless the agreement expressly provides otherwise, a balloon is not a guaranteed return option. Compare a fully repaying quote and consider what happens if the van is worth less than the final payment.
Commercial finance is subject to status, lender approval and the specific asset and transaction. The right structure depends on the complete circumstances of the business.
What should I do next?
Have the asset details, supplier information and an outline of what the business needs ready. DCF can then discuss the requirement and identify which lenders may be suitable.
Read: Van finance →Explore the relevant guides
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