- August 29, 2022
- Posted by: Sergey Grushetskiy
- Category: Semi Truck Financing
Looking to grow your trucking fleet? Understanding the financing options for truck drivers, how to sort through them, plus what to look for is an important part of your expanding business.
Here are a few of the different options that can help you arrive at a good decision.
If you’re looking for the lowest rate possible, you should consider a bank loan. Bank loans generally have decent interest rates but they need your trucking business to have good credit. Plus they can take a little while to fund.
Here are a few features that you should be looking for so you can narrow down your choices. Look for a bank that has business loans available for specialty vehicles as well as trucks and trailers. Finding one that will supply truck loans that last for up to 84 months gives you some wiggle room as your company grows.
Some banks will offer truck loans under the umbrella of equipment financing. Keep in mind bank loans generally require good credit which is a score in the high 600s. You should also have several years in the business before you apply for one of these loans.
Pro Tip: If you need to do a little work on your credit score before you apply for one of these loans, consider adding positive trade references. Any existing positive experiences with business partners, vendors and suppliers can have a positive impact on your credit score.
Banks and traditional lending institutions aren’t the only choices for financing.
Alternative Lenders: Other Financing Options for Truck Drivers
This is a good option for trucking companies that need funding quickly. The qualifications are usually more flexible and the financing is usually faster.
Some of the options here are good for same-day funding and others work best with startup trucking companies. For example, it’s possible to find semi truck loans for up to $500,000 that include refrigerator trucks as well as other heavy-duty and light vehicles.
You need to be in business for at least a year and have a minimum annual revenue. Some of these companies can offer loans even with credit scores as low as 540.
Pro Tip: A big part of financing and expanding your truck fleet is paying attention to the FICO score. These are widely used measures of risk. These scores also help lenders make decisions based on regulatory requirements. It’s important for companies looking for financing based on credit reports.
If you have a challenging credit history, the last option might be your best bet for financing.
Direct lenders have a distinct advantage. They usually have years of experience in the trucking industry and the flexibility you won’t find with other financial institutions. The reason is simple. They lend out their own money.
Pro Tip: Comparing rates here is the best way to make sure you’re getting a good deal. You’ll also want to look for other features like engine overhaul financing as an added incentive.
10-4 Financing is committed to helping your trucking company get competitive rates and zero down payments when you’re looking for financing. We are committed to supplying an industry-leading semi-truck financing service in America. Let us help you find the best options for your enterprise today. Call 888-908-7701 or contact us online.
We have been supplying financing options for truck drivers since 2011.