Can a Trust Get Equipment Finance?

How trusts borrow for equipment

Trusts, whether family, discretionary or unit trusts, are a familiar structure to lenders, so equipment finance is well within reach. The loan is typically written in the name of the trustee acting on behalf of the trust, using the trust's ABN and trading history. Where the trustee is a company, that company enters the finance in its trustee capacity. The machine serves as security in the usual way. Because the people who control and benefit from the trust ultimately stand behind the business, lenders generally ask them to provide personal guarantees. Provided the trust trades soundly and the guarantors have reasonable profiles, this is a straightforward application for the market.

Trustees, guarantees and beneficiaries

Lenders look at who controls the trust and who benefits from it. A corporate trustee is common and generally well accepted, and its directors will usually guarantee the loan. Where an individual is trustee, that person typically guarantees it. Beneficiaries do not always need to be involved, but the guarantors, whoever they are, will be assessed on credit and identification. This means the personal positions of the key individuals matter, much as with any structure. Being clear about who the trustee is and who will guarantee the finance from the outset helps a broker direct the application to lenders comfortable with your particular trust arrangement.

Documents lenders want to see

For a trust, lenders generally want the trust's ABN details and, in many cases, a copy of the trust deed to confirm the trustee has power to borrow and grant security. Identification for the trustee and guarantors, plus recent business bank statements, complete the core file. Details of the machine, the supplier and any deposit are also needed. The trust deed requirement is the main difference from a simpler structure, so having it to hand avoids delay. A complete, correctly documented file lets a lender assess confidently and tends to produce both a faster answer and sharper pricing.

Why the right lender matters

Lenders vary in how they handle trusts, corporate trustees and deed requirements, so matching to the right one avoids friction. A broker knows which lenders are comfortable with trust structures and exactly what documentation each expects. Simon can compare more than 80 lenders on a single application, aligning your trust, its cash flow and the asset with lenders likely to approve and to price well. That prevents wasted applications, keeps credit enquiries to a minimum and ensures the trustee and guarantee paperwork is set up correctly from the start rather than being corrected later.

Financing a machine through a trust is routine when it is set up correctly. If you want it handled cleanly and priced competitively, Simon can compare the market and guide the documentation. Request a free quote to see what your trust can achieve.