All small business owners need a vehicle to ensure that their orders are dispatched on time and they always have stockpiled supplies. As a small business owner, oftentimes, you will think about how a delivery truck will streamline your business operations while hiking up the sales. Additionally, it also enables you to save extra cash otherwise spent on delivery/courier services.
We know that you want to buy a truck but can't pile up the cash, and this is where commercial truck financing comes in. This article will give you a rundown on an equipment financer world-famous for its easy and smooth small business truck loans. Amur is a financer that will enable you to be the first truck-owner of your own business.
Amur Equipment Finance started its operations in 1996 in Grand Island, Nebraska. Since 1996, Amur has become a customer-favorite financer and has cemented its reputation as the largest independent equipment financer. However, saying Amur Equipment Finance in a single breath can be a bit of a jawbreaker. That's why they have recently changed its name to simply 'Amur'.
This move also reflects the company's shift towards making its processes more digital and swift. As an old guard of the equipment financing world, Amur has many feathers in its cap; recently, the company was named one of the Top Five independent equipment financing companies.
On top of this, Amur has earned its mark by becoming a certified Great Place to Work. The country offices of the company are located in California, Iowa, Texas, South Dakota, New York, etc.
Amur focuses on equipment-intensive industries like transportation, construction, technology, food service, agriculture, packaging, and energy. Amur makes it easier for small companies to achieve economies of scale without giving up on their cash resources. Amur wants to make small businesses stand on their feet, and that's why all its customer research and branding caters to the needs of small business owners.
There are still some businesses that can't claim the benefits of Amur's equipment financing. For example, Amur doesn't finance industries such as beauty and makeup, companies funded via memberships, some medicines, tattoo shops, etc.
Amur Finance: What Makes It So Special?
Amur doesn't discriminate against its customers. Loans are given regardless of the customer's zip code, religion, or ethnic background. Additionally, Amur doesn't care about your credit history. As long as your application is strong, Amur will be glad to push your business in the right direction by purchasing machinery/equipment for you. Using loans from Amur, your finance costs are tax-deductible.
In addition, you will not be charged tax on the money you pay for leasing/buying equipment with Amur's loan. To add the cherry on top of all these advantages, you incur zero dollars on applying for a loan at Amur. However, there can be delays in application approval, so Amur might not be the right place for you if you are in a hurry.
...having essential capital means big things to your small business, and we believe that access should be universal."
Who Should Apply for Commercial Truck Financing with Amur?
Amur caters to the needs of small businesses. Businesses that want to grow but their growth is inhibited by cost-prohibitive equipment required to expand the said businesses. The mission statement of Amur says that "...having essential capital means big things to your small business, and we believe that access should be universal."
So, suppose you are a small business owner and don't want to spend all your cash on getting rid of the obsolete machinery without compromising the cash inflow of your business. In that case, Amur is by far your best choice for equipment financing. Using the liberal financing packages of Amur, you can avail of loans from anywhere between $10,000 and $350,000.
Amur is now a financier of over 15,000 equipment vendors across the US and simultaneously a trusted partner of 40,000 small businesses.
Amur financing has many advantages over its competitors, like giving loans tailored to the needs and wants of your individual business. This shows that Amur does a lot of research to know the realities of a particular industry.
Afterwards, it creates a loan package that can reliably meet the needs of such a business. Furthermore, the application process at Amur is swift, no nonsense, and cuts it to the chase with a final decision coming out in just 24-48 hours.
Now, after your loan is approved, Amur ensures that all the process leading up to the delivery of the equipment is hassle-free. This is done with the help of the creation of specific teams which have the know-how of your business.
Also, if you don't want to buy the equipment/truck outright but are thinking about leasing it for a few years (as the nature of your business is fast-changing), Amur still has you covered. Amur offers three distinct loans: operating lease, finance lease, and equipment finance agreement (EFA).
Types of Loans at Amur
Operating Leases works for those businesses where the nature of business is fast-changing. There is no transfer of ownership from the lessor (Amur) to the lessee (individual company) in this lease. As the right does not transfer the lessee expenses out of the cash, it pays for the use of equipment every month.
However, in most cases, you may get an option to purchase the equipment at the end of the lease term if you so want. The purchasing price or sometimes referred to as the balloon payment, in this case, depends on the fair market value of the equipment at the end of the lease term. As said before, this leasing agreement works best for businesses with constant up-gradation needs, so they don't need permanent ownership of any specific asset.
The other lease agreement that Amur lets you enter into is the finance lease or capital lease. It is different from an operating lease in that the ownership transfers from Amur to you in this case. There is just one caveat: the right remains with Amur throughout the leasing period. You get to buy the equipment at a predetermined price after the elective end of the lease term.
However, unlike an operating lease, where you are allowed to expense out your installments to Amur, enabling you to claim a tax deduction on such expense, you cannot do the same in the finance lease. In this case, the ownership of the equipment is deemed to have been transferred to the individual businesses as most businesses do exercise the option of buying the equipment at the end of the lease term.
While you cannot claim a tax deduction on expenses (mainly because you are not allowed to expense out a finance lease), there are other ways to claim a tax deduction. For example, you can claim a tax deduction under section 179 or a depreciation allowance.
Equipment Finance Agreement
Equipment Finance Agreements (EFAs) are agreements in which the buyer gets total control over the equipment, but the finance company (Amur) has a security stake in the kit. With an EFA, you don't get to purchase the equipment at the end of the EFA agreement (actually, because you already own the equipment from the start of the EFA agreement).
EFA gives you the option of holding the equipment in your name. Thus, the depreciation on equipment can be claimed as tax-deductible. EFAs have a flexible structure, easy approvals, and low minimum down payment requirements.
You and the Amur specialist team will discuss all these different finance arrangements. Then, the specialist Amur team will help you get down to a deal that best suits your business's needs. So, there is nothing to worry about if you don't understand the preferential approach for your business right away.
“Many cool and hitherto untried features make Amur stand out from its competitors”
How Do You Qualify for Amur Commercial Truck Financing?
Amur works with small businesses looking for equipment to run their businesses and equipment vendors. Amur financing works in three tiers: First, your placement in a story depends on your credit history, which eventually decides the kind of loan you will get. Moreover, the terms of the loan and the repayment method also depend on your credit history. The different types of financing options are discussed below.
- A-level credit customers with a higher FICO score (usually 700) and over seven years of business experience. These customers can avail of financing upto $350,000 at an interest rate of 6.74%.
- B-level credit customers with a FICO score of 660 are given a loan of $250,000 if they have industry experience of 2 years. The interest accrues at the rate of 7.99 per annum.
- C-level credit is the lowest tier of the three. Customers with a FICO score of 620 or an industry experience of 2 years can get this loan. The C-level credit loan comes at 11.24% interest, and you can get as much as $125,000 with this loan.
New businesses are financed via an entirely different scheme. These businesses should have an excellent credit rating to get Amur financing. Besides, they also have to pay a 20% down payment. They qualify for loans only after they are willing to pay down compensation. The funding of such businesses can only go as high as $60,000.
These three customers are charged zero additional fees on their loan processing. These loans can also be availed as Amur special loans for the Over-the-road Trucking Program. As stated previously, Amur works with vendors and manufacturers to provide small business owners with merchandise and equipment. Similarly, you can also partner with Amur as an equipment provider.
Many cool and hitherto untried features make Amur stand out from its competitors. One of such features on Amur's website is something called 'Get a Quick Quote'. Using this feature, you can use the equipment cost and credit history to get the right loan. This cool feature also helps you see the breakdown of your expenses per month.
Amur Loan Application Process
Amur Application starts with seeing a quote for your financing on the company's website. All the application process is completely online. The application form starts with asking you about your financing needs. The first page asks you about your business's financial situation and the equipment financing you will need.
Next, you have to answer questions like your credit rating, the number of years you have been in the business, and the kind of equipment you want to finance. You can proceed with the next page when you have answered these questions.
After filling out this basic form, Amur gives you a quote for your financing needs. The selection is offered in several options. Each option with a different estimated monthly cost is broken down into 2, 4, 8, or even ten years. Each option comes with an additional amount of monthly installments to be paid.
After setting your password and email, you can have the quote emailed to you and proceed with your application form. However, you are still subject to a full credit review before processing the financing.
If you are still confused about the application form, we suggest you get on the Amur website and try their online tools like Quote tools or section 179 calculator. That way, you will be at least able to get a string of possible quotes for your financing needs. In addition, the quote tool helps you get closer to one of the many financing options that you think will work best for you.
Amur Commercial Truck/Equipment Financing Interest Rates
At Amur, you can expect to be financed with any amount ranging from $10,000 to $250,000, and also your loan term can range from anywhere between 38 to 84 months. However, the interest rates at Amur depend on four things:
- Your creditworthiness roughly falls into Level A, Level B, and Level C levels. The better your story, the lesser the interest rates.
- The number of years of business standing. If you are an old guard in your particular industry, you can expect the interest rates to decrease.
- Lastly, the amount of financing you need. Of course, the greater the funding required the higher the interest rates will be.
- FICO scores. Again there is an inverse relationship between the interest rates and the business' FICO score. The bigger the FICO scores for your business, the lower the interest rates charged.
The interest rates for small business loans/leases at Amur range between 6.74% for Level A credit customers (for an amount of $350,000) to 11.24% for Level C credit customers (for an amount of $125,000). Besides these, Amur also finances new businesses. However, the restrictions on new companies are much tougher. They are supposed to pay much more in down payments while their financing is much lower.
The pay/installments structure is also pretty flexible. You can pay out your monthly installments without necessarily denting your pockets. Amur payment plans leave enough room for your business to grow. As Amur's mission statement indicates, it wants to help your small business grow rather than stripping it of its cash resources. That's why Amur has come up with several flexible payment structures.
Step Payment Plan
Step Payment Plan is a type of structure where payments start with very low amounts and increase over time. This setup allows you to increase the amount of money you pay gradually. This way, you can have greater relief towards the start of the loan repayment plan. So, if you're a new business with a need for enough cash inflow at the beginning of your business, this option will work best for you.
Deferred Payment Plan
Deferred Payment Plans mean you can hold off your installments in this plan as long as the equipment starts generating revenue. The moment you start earning from the financed equipment, you will begin repaying your loan.
Seasonal Payment Plan
Seasonal Payment Plan will work for businesses with a seasonal period of super high activity when their business generates its best revenue and a period of inactivity where the growth is sluggish and income is diminished. A seasonal Payment Plan means that you will pay greater amounts during periods of high growth than slow growth in your business.
Balloon Payment Plan
Balloon Payment Plan is our favorite type of loan repayment method. In this plan, you get to enjoy all the benefits of the equipment throughout the financing period while paying minimal amounts in repayments. However, you are supposed to pay a lump sum towards the end of the loan period.
This lump sum is bigger than your monthly installments leading upto the sum. Therefore, this payment plan allows companies to purchase more expensive equipment than they would under a traditional payment plan.
What can I finance with the help of Amur Equipment Financing?
Using Amur as your financing partner, you can finance pretty much anything ranging from commercial trucks to a new photocopying machine. Insofar as it is required for your business, any equipment can be funded. However, there is an upper limit to the amount of cash Amur will be willing to pay to ease your financing burden.
Will I be charged application fees?
Unlike other commercial financing companies, Amur doesn't charge any application fee. However, documentation, titling, and shipping fees will be borne by the customer themselves as they are the necessary part of the equipment itself.
How can my creditworthiness be measured?
There are many ways to gauge a business' creditworthiness, including but not limited to the length of time in business, your references for financing, rating via credit bureaus, and databases by the third-party independent . All of this goes into measuring the creditworthiness of an individual business during the application process.
As an owner of a new business, can I apply for financing with Amur?
Yes. All businesses under two years old can apply for financing at Amur. But like all other applications, Amur will measure the creditworthiness of a startup before it finances equipment for them. Mostly a questionnaire with guidelines is issued to assess the creditworthiness.
Can the loan repayment bills be paid online?
Yes. All necessary payments can be made online. All you have to do is log in to your Amur account, jump on the Amur E-Bill Express page, and pay your installments using the invoices.
Is the insurance of the equipment necessary?
Yes. Insurance is a must for the entire duration of equipment financing. Therefore, any breach of this condition will have ramifications for the customers. However, you can use your insurance provider to ensure the equipment for the contract duration. In this case, proof of insurance should be provided to Amur.
Additionally, if you cannot guarantee the equipment on your own, Amur will set up insurance for you through a third-party insurance provider.
Can I prepay my financing cost?
As a part of your contract with Amur, there is no prepayment option (until you are in default). Nonetheless, Amur can help by terminating your agreement earlier if you so request.
What credit score is needed for Amur to finance my equipment?
Amur ensures that your equipment is financed even if you have a bad credit score. Nevertheless, your credit score shouldn't be too bad. If your FICO score falls well below 620, then Amur won't be able to finance your equipment.
What is SBA PPP at Amur?
SBA PPP is an emergency loan arrangement created as a part of the US government's covid relief fund. This program allows small businesses impacted heavily by covid-19 to avail loan forgiveness.
Besides, such businesses can also apply for a lower (0.1%) fixed interest rate and loan installments deferral. Amur is an approved SBA PPP lender as part of this program.