First Time Truck Buyer Financing
There are several reasons why you may want to finance a truck – but if it’s your first time, you may not be too sure on what to do. From finding the ideal price to the right kind of truck, there are often quite a few things to consider. Fortunately for those who want to learn more about this type of financing, here are a few tips that could help you out.
Tips for first time truck buyer finance
Having money ready for a deposit
Often, a financer will want a deposit from a start-up business. While this isn’t the case for all lenders, it may be a wise idea to have some amount of cash prepared in case you need it.
What do financers look for in a potential borrower?
In most cases, you may have an improved chance of approval if:
- Your tax commitments are all up to date
- You have a good credit history (as this often reduces the risk that they won’t make their money back)
- If you have been in business for 2 years
- If you are asset-backed (for example, if you have a house or mortgage)
Financing a newer vehicle
Generally, a truck that is at most 5 years old (at the time of purchase) will have better rates than older vehicles. While it is possible to finance trucks that are older, the repayments may be higher due to shorter loan term
How to finance a truck
Step 1 – In general, a finance broker will have a fifteen minute conversation with their customer to learn more about what type of business they run, how long they’ve been in business and the type of equipment that they need. Also, they may need certain documentation, too.
Step 2 – With this information a broker will get to work on assessing their client’s borrowing potential. Generally, they’ll consider things like:
- If any financial statements and business-related bank statements (for the last 3 months) are available
- If the deal will be low doc with no financials
- If cashflow projection will need to be prepared
Step 3 – When the broker has an idea of how much their client will be able to borrow, they will aim to find a product which will be right for the business and the business needs, as well as prepare a submission for the application.
Step 4 – At this point, the finance specialist will aim to request an invoice for the lender’s records. They may even organise an inspection of the vehicle, too.
Step 5 – With this done, the lender will often prepare the necessary documentation and send them to the client for signing.
Step 6 – Finally, the deal is referred for settlement, the truck is paid for and all that’s left to take delivery of the truck.
Why not use our application process?
If you want to finance a truck, you may be able to benefit from our streamlined process – so why not get in touch with our experts today?
Disclaimer
This newsletter does not necessarily reflect the opinion of the publisher or supplier. It is intended to provide general news and information only. While every care has been taken to ensure the accuracy of the information it contains, neither the publishers, supplier, authors nor their employees, can be held liable for any inaccuracies, errors or omission. Readers are advised to contact their financial adviser, broker or accountant before making any investment decisions and should not rely on this newsletter as a substitute for professional advice.
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