If you are looking forward to finding out about a commercial truck financing rates then you must be definitely facing some difficulty. Well, the reason behind this is that most people who run financing companies have realized a bitter fact that if you tell people how much exactly the financing will cost they will simply avoid to approach you.
So, instead, owners of financing companies usually lie about the amounts of down payments and payments. As soon as, they get to know your credibility, they give you the appropriate information.
From the point of the borrower, if you don’t get proper information directly then will you possibly plan your business? Here we have listed a couple of details which will help you get a clear idea of how commercial truck financing works and how you can acquire one even with a bad credit history.
What you buy makes a lot of difference:
The first thing that you need to clarify is exactly what are you financing. For instance, many financing companies will not be interested in offering a deal for long-haul trucking while other may be specializing in them. Also, if you are buying a semi-tractor with dump trailer and are going to use it for local dump trucking jobs, the deal will be completely different.
Furthermore, some companies will only be financing trucks which are 10 or fewer years older while some may even finance trucks, which are more than 15 years older.
In simple words, depending on the type of truck you are buying and the way you are going to use it makes a lot of difference on the type of options you are offered.
Bad credit is equal to high down payment:
There is no doubt that your credit matters a lot for attaining loans but the scenario for bad credit semi truck financing is a little different. Your credit will certainly determine whether you qualify for financing or not, but moreover, it will determine how much down payment you will have to pay.
Bad credit, as well as less money to pay against down payment, indicates that there are less chances to find a financier, who will be interested in funding your project.
Factors which can make your down payment amount higher:
- You are completely new in business
- You have a poor credit
- You are buying truck from a private party
- You declare you have very less cash reserves
- You are buying an extremely old truck
If you are not in a state to pay the down payment as demanded by the financing company, they will still make you an offer. However, the thing is against this low amount of down payment they might ask you to buy only from a genuine dealer and nowhere else. Also, you cannot pick a very old truck. This is because they are putting in some extra risk in the deal and thus they make sure they are as much secured as possible.
Hopefully, this guide has given you enough info about the factors involved in securing a commercial truck financing.