- June 30, 2022
- Posted by: Sergey Grushetskiy
- Category: Semi Truck Financing
Being a semi truck owner-operator has its pros and cons. When you own your truck you can make money directly from clients without the middleman. However, the cost of repairs and other business expenses fall to you. How will you pay for unexpected expenses that arise?
A business line of credit is a financial tool available to business owners who need additional funds on occasion. It provides you with credit now that you can pay back later.
How can a semi truck owner-operator benefit from a business line of credit? Here are the biggest advantages.
Pay for Truck Repairs
Even with regular maintenance, semi trucks require repairs from time to time. When an unexpected repair arises, you may not always have the cash flow available to pay for it. And if your truck is out of commission, how can you earn the money you need to get it running again?
With a business line of credit you can access the funds you need to repair your truck and pay it back once you have the necessary income. It helps you get out of a tight spot and resume your business to avoid downtime and loss.
Cash Flow for Slow Times
In the trucking industry you may experience slow times where there isn’t as much freight available. This means your income will vary at different points in the year, which can make it difficult to budget your business and your life.
A business line of credit provides you with another source of cash when income is low. Then when business picks back up, you pay back the line of credit so it’s available again the next time you need it.
Only Pay For What You Use
A line of credit has a specific limit, allowing you to borrow as much as you need at a time until you reach your limit. But you only pay interest on the amount you borrow, not the total amount of the line of credit. Interest rates are typically variable for lines of credit, meaning they are subject to change. You can take advantage of a variable rate by borrowing when it is low.
As a new semi truck owner-operator it can be difficult to establish credit. A line of credit is one way to build a good credit score for your business. The key is to make regular payments, keep your balance as low as possible, and avoid missing payments. As you borrow from your line of credit and pay it back repeatedly, on time, you’ll build credit. Once your business has established credit, you’re in a better position to get additional loans and freight that pays more.
Limit Increases As You Go
The longer you have the line of credit and make payments on time, the higher your limit can get. Lenders will gradually increase your limit as they see that you’re using the line of credit and paying it back faithfully. A higher limit allows you to do more with your available credit, beyond just using it when you need a little extra. You can use your line of credit to upgrade your truck, expand your fleet, and grow your business.
Get a Business Line of Credit From 10-4 Financing
Why get a business line of credit from 10-4 Financing? Because we specialize in lending to those in the trucking industry. Our lines of credit for semi truck owner-operators are designed specifically for truck drivers who own their own truck or fleet. We understand what you need in terms of financing and we deliver. Even with a bad credit history, you can qualify for our loans through our bad credit approval process.
Call 888-908-7701 to learn more or apply online now.