If you don't have a fleet of vehicles backing you up, then it would be impossible for you to make your place in the trucking industry. But I do get how most of you won't have hefty cheques deposited in the bank to fund your business expenses.
So, what should you do? You don't have a sufficient amount of money to purchase equipment and vehicles, and you can run your trucking business without them. Aren't you stuck in a dilemma? To get you out of this and offer a more direct and desirable path for you to follow, I have compiled this post for you.
Here I will educate you about which companies can help you with financing your business and which financing options are available for you to begin with. So, get ready to decide the fate of your company now!
Small Business Administration Loans
If you have a remarkable credit score, healthy financial history and are looking to make massive purchases with the capital, you will secure via financing and want to pay back the money in affordable installments. You may just call yourself the dream borrower of every lender.
For someone like you, it will be very easy and convenient to secure an SBA loan. On average, these companies demand a credit score of 550 and above.
These are the companies that will offer SBA loans. As the loans in magnitude and monetary amount are quite high, lenders will consider all of your financial activities. So, try to dazzle them with your compelling business plans and even leverage your other assets.
Expect the interest rate to range from 7.5% to 10% and have many ready in the palm of your hands to pay at least 10% to 20% down payment.
Visit these Online sites and propose your demand and illustrate what kind of loan you are looking for. These services will match you to the appropriate lender so you can minimize the hassle of finding the "right lender".
These loans are particular, and the lender aims to promote young businesses to establish their grounds by purchasing all necessary equipment. If you have a low score and consider yourself an applicant who may not qualify for conventional bank loans, you must pursue this option.
If you are a qualified buyer and have diamonds specked in your application, you can easily score a loan at an interest rate of 5%. But if you barely meet the essential requirement, then you must have to pay the loan back at higher interest rates. Possibly around 24% and higher. Plus the term length will extend from 3 years to 7 years.
- LendioThe interest rate here can be as low as 2% for the most qualified borrowers. You can acquire a loan from $2K to $5M. The term length will vary according to your payment plan.
- US Business Funding
You can secure a loan of up to $10 M and be charged at a low-interest rate of 3.5%. The term length can extend up to 10 years even.
With a starting interest rate of 5%, you can secure a loan from $5K to $500K. The payments may extend from 24 months to 72 months.
The payment term extends from 1-72 months; here, you can secure a loan of up to $250K and an interest of 5.49%.
Equipment is perfect for you if you are looking to upgrade your vehicle after every few months or possibly a few years. It's like renting a truck and paying the lender a specific amount every month for its use. Though you will be responsible for the maintenance and fuel costs, you won't gain possession of the truck at the end of the term.
You wouldn't need an impressive profile or high credit score. You can quickly get the vehicle and use it for your business and then return it. Search more about the following companies, view the vehicles and trucks they have saved in the inventory, and decide if this financing method suits you or not:
Traditional Bank Loans
You can never go wrong with this financing mode because it is the most formally used and popular approach. But it may not be suitable for everyone. Acquiring a bank loan is an intricate process, and you need to qualify heaps of stages to sign an agreement that accounts for your terms.
But if you have a good credit score, want to play it safe, and are looking to be affiliated with a known bank to garner a good reputation, then you must move forward with it. Here are some of the popular banks that you must keep on the top of your list.
Business Credit Card
You will definitely like this option because you will always have imminent access to cash whenever you need it, especially in times of emergency. The trucking business will continue to proceed with the day to day operations and activities, so it would be rather tricky for you to earn revenue and then budget the entire month accordingly.
You would need fast cash that is readily available, and you can worry about paying it later. Or it can be deducted at the beginning of every month. This is why business credit cards are so suited to financing commercial trucking business. Here are some of the financial bodies that will grant you a business credit card:
It would help if you never let a financial issue stop you from running your business. No matter how much you fill your pockets, you will always run short of money, and you will always need some assistance. You must understand your options and study them in detail to determine which one is best suited for your Commercial Truck Financing.