Two products buy the same van and they are not the same thing. A loan pays money into an account, you buy the van outright and it is your asset from the first day. Van finance is an agreement over the van itself: the funder holds title, you cannot sell it without settling, and the rights that attach are the statutory ones that come with a credit agreement rather than the ones that come with ownership. Which suits you depends less on the rate than on what you intend to do with the van.
Business van loan: what a company application changes
A loan to a limited company is underwritten on the company, and where there are no filed accounts that means it is underwritten on the director with a personal guarantee. A loan also leaves the van on the company's balance sheet from the outset, which is usually what an accountant wants for a working asset. Ask which shape the lender is offering before comparing rates, because a business facility and a consumer loan are priced differently and carry different protections.
Van finance for new business: the director's guarantee is the product
A company with nothing filed has no credit history of its own, so the decision is really about the director. Expect to be asked for a personal guarantee, and read it rather than skimming it: it makes the director liable for the balance if the company does not pay, it is outside the company's limited liability, and it survives the company being dissolved. That document, not the monthly figure, is the thing to negotiate.
Ownership decides what you can do next
On a loan the van is yours, so you can sell it, modify it or take it off the road whenever the business needs to, and the loan simply continues. On finance the funder holds title until the agreement ends, so selling before settlement is not yours to do and modifications usually need permission. If the van is likely to be replaced or sold mid-term, that constraint matters more than a percentage point.
Questions people ask about van loan
Is it cheaper to buy a van on finance or on a loan?
It depends which risk the lender is pricing. Finance is secured on the van, so the rate is often lower for the same applicant, while a loan is priced on you alone. Compare the total amount payable over the same term on the same van, not the rate.
Are used van finance deals priced differently from new?
Yes. A funder lends against what it could resell, so age, mileage and how standard the van is all move the rate and the deposit asked for. A three or four year old panel van of a common trade model is usually the easiest thing to finance.
Can a sole trader take a van loan rather than finance?
Yes, and it is common. It is underwritten on your own file and income, and the van is yours from the start. Whether the agreement is regulated depends on how the van is used: one wholly or predominantly for business can fall outside consumer credit protection.
Can I settle a van loan or van finance early?
A regulated credit agreement carries a statutory right to complete payments ahead of time under the Consumer Credit Act 1974, linked below, with a rebate of some future interest. An unregulated business facility carries whatever the contract says, so check the early settlement clause before signing.