Do you know that banks and auto companies’ offer commercial auto financing designed exclusively with the business owner in mind? For example, Ally Bank offers a Third Party Guaranty Program that allows you to keep your business auto financing with the business – and your personal name off of the vehicle contract and title. Their commercial auto program enables a business owner to build credit only in the company’s name.

Best of all, Ally’s auto loan or lease payment will not show up on your personal credit reports, it reports only to the business credit reporting agencies. This will further help you build your business credit profile.

In addition, a business owner also gets added protection from liability, since the personal name stays off the vehicle’s title and contract.

However, in the event of default the personal guarantor will ultimately be responsible and it can impact your personal credit if the business is unable to pay.

Now keep in mind Ally bank is just an example. There are many other commercial auto financing programs offered by banks and auto companies such as Ford, General Motors, BMW, Toyota, etc. Below in the download section you will find the applications and brochures for several commercial auto finance programs.

Let’s review some of the various commercial auto financing options.

Buying a Vehicle - Under this program your business may have complete ownership of the vehicle with the title in its name. There are no limits on mileage and the business can sell or trade in the vehicle at any time. Although the monthly payment is usually higher compared to leasing, your business pays to own the vehicle at the end of the contract term.

Leasing a Vehicle - If your company prefers to drive but not own a new vehicle – a commercial auto lease may be a viable alternative. Keep in mind there are mileage limits with end of lease options such as trade in the vehicle for a new model, purchase the vehicle, or turn in the vehicle.

Corporate Auto Financing in the Business Name

If you're looking to finance a vehicle in the name of your business without affecting your personal credit, here are several options:

Third-Party Guaranty - When you want to buy or lease vehicles in the name of your business but need to secure additional financing, you may act as a third-party guarantor. This allows you to keep your name off the title and any debt off your personal credit record.

Business name only - If your business qualifies for financing without the owner's guaranty, you can obtain financing in the business name only. This gives you the ability to save your personal credit for other use as well.

Required Documents

Know the dollar amount, type of loan you are applying for, borrowing purpose and collateral information. If you are looking for a specialized commercial vehicle such as a tow truck, the lender will want to know how you plan to use the vehicle to generate more revenue for your business so keep that in mind.

For all businesses, we require the following information about your business:

• Business name
• Business address
• Business phone number
• Business Tax Identification Number
• Nature of the business
• Date the business was established
• Business acquisition date of current ownership
• Number of employees
• Annual net profit
• Annual gross sales
• List of outstanding obligations, if any (list should include lender, current loan balance or credit limit, and monthly payment)

They will also require the following information about each business owner or guarantor:

• Name
• Home street address
• Home phone number
• Social security number
• Date of birth
• Personal income
• Residence status (rent or own) and monthly housing payment
• You may want to have copies of your most recent business and personal tax returns and/or financial statements to assist with completion of the application.

Remember, purchasing or leasing a vehicle in your business name will further build credit history for your business, reducing the need for personal guarantees in the future. Buying or leasing a vehicle can be a good option. You may gain equity in the vehicle and you may also benefit from financial advantages such as depreciation and tax deductions; be sure to consult your tax adviser for more information.

Business Customers - GM Financial Right Lease℠

Business Customers - GM Financial - The Right Trac℠