Commercial Truck Financing

Obtaining commercial truck financing is a lot easier due to flexible lending options for owner/operators who may not meet stringent prime lender requirements. Owning and operating an 18-wheeler, dump truck or other heavy duty construction vehicle can be expensive. Skyrocketing costs for diesel fuel alone can force some operators out of business. But thanks to borrower-friendly commercial lenders, big rig operators don't have to be left out in the cold when it comes to owning a specialty truck. Some big rig lenders specialize in putting people with less than perfect credit scores on the road using the vehicle as collateral with very little risk. Borrower default simply means that the vehicle is repossessed and the operator loses valuable business until the loan is paid. However, the goal of commercial truck lenders is to make it easy for owner/operators to finance and run big rigs and heavy duty vehicles to make money.

When it comes to commercial truck financing, owner/operators need the best 18-wheeler or heavy-duty truck available at the most affordable price. Manufacturers like Peterbilt, Mack, Kenworth, Freightliner, Volvo, and GMC offer new or pre-owned tractor-trailers, flatbeds, cargo vans, cement mixers, and dump trucks through dealerships across the country. Prices can range from under $35,000 for new heavy duty cargo vans to $65,000 for work horses, such as dump trucks, flat beds and cement mixers; and nearly a quarter of a million for 18-wheelers with high-tech computerized navigation systems, built-in showers, and sleeping quarters. A trucker's rig is not only his bread and butter, but also a home away from home. Long haul drivers typically log eleven- to fourteen-hour nonstop stints on stretches of highway from coast to coast each day; driving, sleeping, eating and showering on board fully-equipped "mini-motels" constructed from 80,000 pounds of precision-tuned steel on wheels! The United States depends heavily on these gladiators of the road and their vehicles to transport valuable goods and commodities across the country as part of an efficient system of interstate commerce. Just as a national network of truckers labor together to transport goods throughout America, so do men and women of God labor for the souls of men. "For we are labourers together with God: ye are Gods husbandry, ye are God's building" (1 Corinthians 3:9).

Owner/operators are willing to invest in top quality new or used vehicles which guarantee seamless, efficient trips on short or long hauls without breakdowns or delays on scheduled runs. The better the rig, the faster the trip; and a faster haul means more money in the bank for truckers who make a living on the road. Owner/operators usually get paid by the mile, anywhere from less than two dimes a mile or up to nearly 50 cents. But a faster, more efficient rig is a guarantee of shorter travel times and faster deliveries that can help drivers bring home the bacon. Lenders who specialize in commercial truck financing understand a trucker's need to keep overhead costs low in order to net larger profits on the road, at construction sites, or on service trips or deliveries. But a sluggish economy can be a formidable foe when applying for any type of business loan. If operators don't have pristine credit and an established company with long-term customers, finding sources for commercial truck financing through conventional lenders can be difficult. That's where flexible lenders come in handy. Some online financing firms offer easy applications and easier terms. Loans can be applied for and approved online without the hassle of haggling and getting turned down by banks and prime lending agencies. Web-based applications can usually receive same-day approval with flexible interest rates contingent upon a buyer's credit history. Excellent to good credit qualifies for lower interest rates than poor ratings.

Commercial truck financing for specialty vehicles and big rigs may be available for up to $250,000 without buyers submitting bank statements and financial reports; and most financing is for five years. Lenders prefer truckers and owner/operators to be at least 21 years of age and show proof of CDL licensing. Substantiated time on the road may be required in some cases as lenders will want to have some proof of an owner/operator's ability to make money on short- or long-haul contracts. Some truckers may consider leasing as opposed to commercial truck financing to purchase new or used vehicles. The advantages to leasing a heavy duty rig, construction, or service truck is that 100% of payments are tax deductible if the vehicle is used solely for business. At the end of the lease agreement, which is usually three to five years, truckers can opt for a buyout with easy payment terms; or elect to continue leasing another vehicle. Leasing also provides trucking company operators the option of building and maintaining a fleet of up-to-date trucks equipped with the latest computerized navigation systems and fuel efficient engines. Operating more modern trucks ensures greater savings in fuel, fewer maintenance and replacement costs, and a better bottom line.

Companies or individual operators seeking pricing on new or used 18-wheelers, dump trucks, cement mixers, or flat beds can go online and browse trucking websites. Some sites not only offer online applications, but also digital loan calculators for estimating payments. Individuals can get instant quotes based on the number of years requested for commercial truck financing and principal amount of the loan. Truckers may be able to digitally sign loan applications online; and once approved, monies can be electronically deposited in lien holder or borrower accounts. Transactions normally take within 24 to 48 hours. Truckers can then arrange for transport of purchased vehicles, which must be registered with the Department of Transportation in the owner's state of residence. With title and tag in hand, and flexible commercial truck financing completed, owner/operators are ready to hit the highway in search of the next opportunity to serve the American consumer and make a substantial living as one of the true kings of the road.

Heavy Equipment Financing

Heavy equipment financing enables companies to replace and secure items such dump trucks, bulldozers, cranes, graders and many other large expense pieces of equipment. For many companies, the profit lies in the day in and day out use of these pricey machines, so replacing outdated or inefficient equipment is vital. And deciding how to pay for them is also vital, particularly in a business climate that is so uncertain. There are a number of reasons companies finance their big machinery in the manner in which they do, and all of it has to do with cash flow. Consider these various factors:

If a company is a brand new start-up and lacks substantial cash, the business may consider machinery financing from a leasing standpoint. Leasing these behemoths makes sense for the start-up from an accounting point of view. Lease payments do not show up as debt and thus do not hurt a company's financial statement. This is a very popular way to approach heavy equipment financing because over eighty percent of all US companies lease at least some or most of their machinery. Leasing approval is usually a much quicker process than heavy equipment financing and can be done in a few hours in many cases. Leasing programs for these large machinery pieces can also include maintenance if the company desires.

But if a company wants to actually own these large scale tools for their services, then heavy equipment financing is probably the way to accomplish such a task. There are traditional ways to buy these tools and also non-traditional ways. If a start-up excavation company for example, needs to purchase two million dollars worth of machinery for their service, the first look may be to a bank, which would probably offer the most reasonable interest rates for the purchase. But in these very difficult economic days, the availability of easy credit is gone, and the borrowing parties involved in such transaction will have to have sterling credit histories to even be considered by a bank. Heavy construction equipment does not have the depreciation that a car might have, or office equipment might experience, and obsolescence is not as planned a factor as might be with a computer or copier. So despite the lack of those negative factors and that the bank would hold title to the machinery, the business owner and other partners would have to possess almost perfect credit to pass the bank smell test. Banks rates will be the lowest of any other source, but if that option falls through, there are other possibilities.

Perhaps this construction company cannot find an agreement with a bank, and so the next step in heavy equipment financing may be to look for an angel investor group. In most cases, these private investors only invest in tech businesses. Medical, bio-tech and related fields are the most appealing for this niche group of lenders, but an entrepreneur with excellent financials and a very aggressive business plan might persuade these wealthy investors to lend. Of course with any private investing group, the cost will be high in terms of interest rates, but often these investors are big in assisting new businesses and may craft a more palatable agreement. There is another non-traditional option for heavy machinery financing and that is the hard money lender.


In most cases, the hard money lender is a wealthy investor living in the same geographic area as the project to be financed. The hard money lender will probably be very aware of the entrepreneur who is seeking the heavy equipment financing money, and may even know the person on a friendship basis. Since this is totally private money being discussed, there are no regulations or limits to define the parameters for such an agreement. In most cases, a hard money lender is not interested in anything other than a twelve or eighteen month lending agreement; just long enough for the entrepreneur to find more traditional sources of backing. In some cases, however, the hard money lender may be quite interested in a portion of the business as part of the financial agreement. The interest rates will be high on the borrowed money, points on the one year loan will be as many as four or five and this kind of lender will only lend between sixty and seventy percent of the needed cash, leaving the entrepreneur to find the rest. In many cases, the hard money lender will ask the borrower to put up not only the purchased machinery, but also property, such as an office building or a personal residence as collateral.

In most cases, there will always be money from somewhere for heavy equipment financing. Even Middle Eastern banks advertise online to fund American requests for equipment cash. Banks, angel investors, hard cash lenders and other yet unexplored resources are there as financial possibilities. For the Christian there is great comfort in knowing that God is very much in control of our lives and knows our every need. "Be careful for nothing; but in everything by prayer and supplication let your requests be made known unto God and the peace of God which passeth all understanding shall keep your hearts and minds through Christ Jesus." (Philippians 4:7, 8) Some online equipment financiers tout that entrepreneurs only need a FICO of seven hundred to make a heavy equipment financing loan. Moving earth may not be so hard after all, if the borrower can get past obstacles in his way.





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