Financing a Commercial Van in New Brunswick After a Repossession
Securing financing for a commercial van after a repossession presents a unique set of challenges. Lenders view this credit profile as high-risk, which directly impacts interest rates. However, a commercial vehicle is an income-generating asset, a factor that can work in your favour. This calculator is specifically calibrated for your situation: a 96-month term in New Brunswick, factoring in the 15% HST and the realities of a credit score between 300-500.
How This Calculator Works
This tool provides a realistic estimate by locking in variables specific to your scenario:
- Province & Tax: All calculations include New Brunswick's 15% Harmonized Sales Tax (HST) applied to the vehicle's selling price.
- Credit Profile: The interest rate is estimated between 24.99% and 29.99%. This is a typical range for subprime loans following a significant credit event like a repossession. (On Approved Credit. This is an estimate, not a guaranteed rate).
- Vehicle Type: Calculations are based on the needs of a commercial van buyer, who often requires a reliable, functional vehicle for business purposes.
- Loan Term: The term is fixed at 96 months. This is the longest available term, designed to make monthly payments as low as possible, though it results in more interest paid over the life of the loan.
Example Commercial Van Loan Scenarios (96-Month Term)
The table below illustrates potential monthly payments for common commercial van price points in New Brunswick, assuming a high-risk interest rate of 29.99%.
| Vehicle Price | 15% NB HST | Total Price | Down Payment | Total Financed | Est. Monthly Payment |
|---|---|---|---|---|---|
| $25,000 | $3,750 | $28,750 | $2,500 | $26,250 | ~$725 |
| $35,000 | $5,250 | $40,250 | $3,500 | $36,750 | ~$1,015 |
| $45,000 | $6,750 | $51,750 | $5,000 | $46,750 | ~$1,291 |
Disclaimer: These are estimates for illustrative purposes only. Your actual payment will depend on the specific vehicle, lender, and your personal financial situation.
Your Approval Odds: What Lenders Need to See
With a repossession on file, lenders shift their focus from your credit score to other indicators of stability and ability to pay. The score itself is less important than the story behind your current financial health. For more on this, check out our guide on how Your Credit Score is NOT Your Rate. Get a Fair Loan, Toronto.
To approve a commercial van loan in this scenario, a lender will require:
- Proof of Stable Income: Since this is a commercial vehicle, proving your business's viability is paramount. Bank statements showing consistent revenue are more powerful than traditional pay stubs. If you're self-employed, demonstrating this is key. For a deeper dive, read about how being Self-Employed? Your Bank Account *Is* Your Proof. Get Approved.
- A Substantial Down Payment: A down payment of 10-20% of the vehicle's total price (including tax) significantly reduces the lender's risk. It demonstrates your commitment and financial capacity.
- Time & Re-established Credit: The more time that has passed since the repossession, the better. If you have taken steps to rebuild your credit since, such as managing a credit card or clearing other debts, it strengthens your case. This is similar to the positive steps taken by those who have completed a formal debt management plan, as explained in Consumer Proposal? Good. Your Car Loan Just Got Easier.
- A Clear Business Case: Explain why you need the van for your work. A signed contract or a detailed business plan can turn a 'maybe' into a 'yes'.
Frequently Asked Questions
Can I really get a commercial van loan in NB after a repossession?
Yes, it is possible, but challenging. Approval depends less on your past credit score and more on your current income stability, the size of your down payment, and the time elapsed since the repossession. Lenders are more likely to finance an income-generating asset like a commercial van than a personal vehicle in this situation.
Why is the interest rate so high for a 96-month term with bad credit?
The interest rate reflects the lender's risk. A past repossession signals a higher chance of default. A 96-month term, while lowering monthly payments, also extends the time the lender's capital is at risk. The combination of high credit risk and long duration results in the highest interest rate brackets, typically 25% or more.
How much down payment do I need for a commercial van with a 300-500 credit score?
While there's no mandatory amount, a strong application will include a down payment of at least 10-20% of the vehicle's total cost (including the 15% HST). For a $35,000 van, which becomes $40,250 with tax, a down payment between $4,000 and $8,000 would significantly improve your approval chances.
Will financing a commercial van help rebuild my credit after a repo?
Absolutely. A new auto loan that is paid consistently on time is one of the most effective ways to rebuild your credit. Each on-time payment is reported to the credit bureaus (Equifax and TransUnion), demonstrating new, positive credit behaviour and gradually improving your score over time.
Does the 15% HST in New Brunswick get included in the loan?
Yes. The 15% HST is applied to the selling price of the vehicle, and this total amount becomes the basis for your loan. Your down payment is then subtracted from this total. For example, a $30,000 van has $4,500 in HST, making the total price $34,500 before any down payment is applied.
