Financing a Small Trailer: Box, Car and Tradie Trailers
Smaller trailers raise a different question: is it worth financing at all, and if so, how? Here's how to think it through.
The minimum loan issue
Many secured lenders have minimum loan amounts, so a basic 6x4 box trailer may be too small for them. That doesn't mean you can't borrow, just that the best option changes.
Options for a smaller trailer
- Save up or pay cash. For a few thousand dollars, avoiding interest and fees altogether is often best.
- Small personal loan. Unsecured, so the trailer's age doesn't matter, but rates are higher.
- Bundle it. If you're buying a car, ute, bike or boat at the same time, add the trailer to that loan.
- Secured trailer loan. For larger tandem, enclosed and car trailers, a secured loan usually gives the lowest rate.
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Tradie trailers
A cage trailer or enclosed tool trailer used for work should go through your business. Financing it through your ABN can let you claim the GST and deductions, if you're eligible. See trailer loans for tradies.
Car trailers
Tilt and beavertail car trailers cost more than box trailers and suit secured finance well. Check the ATM covers the car you'll carry, and that the trailer has brakes rated for the weight.
What to watch for
On small loans, fees can be large compared with the amount borrowed. Look at the total you'll repay, not just the weekly figure. A $40 establishment fee is one thing; a $400 one on a $4,000 loan is another.