18 June Financing Options for Truck Purchases
First of all, it’s imperative to understand that acquiring commercial and semi-truck financing is not the same as obtaining a loan for a personal vehicle. They differ in the cost price, and where to locate the funding you’d need. Commercial truck financing is made obtainable if you are:
- Buying a new or used truck
- Leasing a new or used truck
- Repairing/upgrading a truck that you already own
Although commercial truck financing comes in many forms, it is usually made available as a form of heavy equipment financing. As the name implies, it means that it will be employed to buy equipment (like a commercial or semi-truck) while the equipment serves as collateral for the loan, with the cost and probable lifespan of the equipment in view.
Regardless, before going for any commercial truck financing options, you’d surely need a great business plan, a good credit score, and a firm knowledge of how much funding you need. Here are some financing options for truck purchases:
WITH NO MONEY DOWN
It works like a loan where you don’t put any money down. However, that means you’ll pay more interest in the end because you are financing 100% of the actual truck’s value. Or you can opt for an operating lease, which is less of a purchase financing option and more of a car lease. Here, your company wouldn’t take actual ownership of the asset as it works just like a rental contract. This means you practically own the truck until the end of the term when you return it.
WITH BAD CREDIT
Although this funding seems limited, it is not impossible. Here, top-tier options like banks are not likely to be your best option. However, you can sort out commercial truck lenders that specialize in truckers with bad credit.Just search for subprime lenders willing to offer you some commercial truck loan based on your personal financial and credit peculiarity.
WITH FAIR CREDIT
Here, you’re likely to have a decent credit score in the mid-600s and some operating history. This is capable of getting to some decent financing options. Here, semi-truck financing companies are most likely, your best bet in acquiring the services, rates, and terms you need. You can opt for truck loans or capital leases (which is different from operational lease), and get your official related documentation ready like your business license, commercial driver’s license, permits, personal info, etc.
WITH EXCELLENT CREDIT
Here, you can be sure to have great financing options from even large banks that are household names. You can as well choose between a loan or a lease from a semi-truck financing company as well as an online or alternative lender.
Start by considering a commercial truck financing company that specializes in equipment financing or startups. They’ll help find lending options that suit your financial situation best. Some of the best truck financing companies that work with small business funding can help you get your startup prequalified in due time. They can specifically help you work in line with your personalized needs.
Here, you can consider an operating lease because it will afford you access to new trucks practically every few years as your lease matures. What’s more, you get to access quality trucks in great working capacities. Plus, you get to worry less about monthly payments as it is lower than other financing options, which lessens your financial burden.
As a result of this truck’s peculiarity, it is viewed differently. Hence, there is always a truck appraisal before you’re given a loan, especially if you’re on to a semi-used truck. Commercial truck financing is what you should consider. Although it generates tremendous revenue, it is quite expensive to acquire. Get your finances, business plans, and credit history in order, and you’re sure to be approved with favorable terms.
Regardless of your choice, it’s always crucial that you research the company you plan to opt for. And be sure that they are reliable, trustworthy, and workable for you based on your pocket and your business.