Loan Options for Van Finance
When a loan is the right route to buy a van, how it compares with hire purchase and contract hire, and what terms to expect in 2026.
What is a van loan?
A van loan funds the purchase of the vehicle as a lump sum. You own the van on day one and repay the lender over an agreed term, usually 12 to 60 months.
This makes a loan different from contract hire and finance lease. Those are rental products where ownership stays with the finance company. With a loan, the van is yours from the moment the money lands.
When a loan makes more sense than leasing
Leasing is usually the right fit for VAT-registered fleets buying new vans. A loan often wins in a handful of specific situations.
- Personal use, where you are not VAT-registered and cannot benefit from rental VAT recovery
- Buying a used van, which is harder to lease through standard contract hire channels
- Vehicles outside manufacturer warranty, where lease providers often decline
- Short-term cash-flow situations, where a loan bridges a specific gap
- Buying through an LLP or limited partnership where lease structures are awkward to document
Options we can arrange
We work across several loan structures. The right one depends on the van, the business and how much flexibility you need.
Unsecured business loan
No vehicle collateral required. Faster approval and lighter paperwork, but the rate sits higher than secured lending.
Secured asset loan
The van itself acts as security. Lower rates and longer terms, useful when borrowing a larger amount or stretching repayments.
Cash-flow loan
Working capital for mixed use. Covers a vehicle alongside operational costs when a single asset loan is not the right shape.
Invoice finance bridging
Advance against outstanding invoices. Useful to close a gap between paying for a van and receiving customer payments.
Typical terms in 2026
Indicative figures based on current panel rates. Your own offer depends on the lender, the van and your credit profile.
Term
12 to 60 months
Matched to the life you expect from the van.
Deposit
From £0
Secured asset loans sometimes need no deposit at all.
Decision
Within 24 hours
Subject to credit checks and basic documents.
Sion Jones Commercials Ltd is not FCA regulated. This figure is indicative and applies to unregulated customers only (typically UK limited companies and larger partnerships). We cannot introduce sole traders, individuals or small partnerships to a finance broker or lender.
Who we work with
Where a customer qualifies as unregulated for FCA purposes (typically UK limited companies and larger partnerships), we can introduce them to an FCA-authorised panel of lenders. The enquiry goes to the panel member most likely to approve it at the best rate.
For specialist products we also work with Padington Business Finance alongside our direct panel lenders. Any introducer commission is disclosed in line with FCA rules.
FCA notice
Sion Jones Commercials are not able to introduce regulated clients to any kind of broker / lender as this is an act of credit broking and is regulated by the FCA where the client is a sole trader, individual, or small partnership.
How to apply
Talk to us. We send your details to the right lender. You get a decision.
The application form takes a few minutes. We come back to you within one working day with the rate and repayment options.
Compared with other van finance
Loans, hire purchase and contract hire all fund a van in different ways. The right choice depends on whether you want to own the van, how you want it to sit on your books, and how sensitive you are to the monthly cost.
Loan
You own the van on day one.
- Full ownership from day one
- Pay interest to the lender over the term
- VAT reclaimable upfront on the vehicle cost (VAT-registered businesses)
- Van sits on your balance sheet as an asset
- Claim capital allowances (AIA up to £1m)
Hire purchase
You own the van after the final payment.
- Ownership transfers at the end of the agreement
- Fixed monthly payments over 24 to 60 months
- VAT treatment similar to a loan
- Van sits on your balance sheet as an asset
- Claim capital allowances on the full vehicle cost
Contract hire
You never own. You hand the van back.
- No ownership at any point
- Typically the lowest monthly payment
- 100% VAT reclaimable on rentals for qualifying commercial vehicles
- Off balance sheet for accounting purposes
- No residual value or resale risk
Loan finance FAQs
Is a van loan tax deductible?
Interest paid on a business loan is deductible as a business expense. You can also claim capital allowances against the vehicle cost, including the Annual Investment Allowance up to £1m, which reduces your tax bill in the year you buy the van.
Do I need a deposit for a van loan?
Often yes. A deposit of 10 to 30% is common for unsecured lending. Secured asset loans sometimes need no deposit at all because the vehicle acts as security. A larger deposit reduces the monthly cost and the total interest paid.
Can I get a loan for a used van?
Yes. Loans are often the most straightforward route for used vehicles. Lease products are harder to find for older stock, so loan finance is usually the right fit for ex-fleet, ex-demo and trade-in vans.
How fast is the decision?
Typically within 24 hours, subject to credit checks and basic documents. Time-sensitive purchases can sometimes be decided faster if the lender has everything it needs first time.
What interest rate can I expect?
It depends on the loan term, the deposit, your credit profile and whether the loan is secured or unsecured. We shop the enquiry across our panel and confirm the rate in writing before you commit to anything.