subject: Dump Truck Financing - Different Ways Of Financing That Commercial Vehicle [print this page] Dump Truck Financing - Different Ways Of Financing That Commercial Vehicle
Dump Truck Financing can be arranged in one of the five following methods:
Dealer financing is done when the dump truck is financed by the dealer instead of a lending institution. Dealers usually offer financing on trucks that came back into their inventory when a lease expired or the truck was repossessed due to a loan default. This is a good alternative to regular business equipment loans for recent startup businesses. Without an earnings history or high credit score, most new businesses cannot get conventional dump truck financing at their local bank. The dealer gets a quicker and longer cash flow from these vehicles.
Financing with a cosigner can help dump truck purchasers with new or bad credit get better financing than their own credit ratings warrant. A business partner with a longer business history and better credit ratings can allow a purchaser to get a lower interest rate if the purchaser and cosigner do not object to the lender's underwriting requirements. The cosigner may require a small ownership interest in the business as collateral for the risk they incur.
Purchase from a private party seller. Private party sellers are owners of a dump truck they wish to sell but are not in the dump truck financing or sales business. Since it is frequently a one truck sale, private party sellers do not have the resources dump truck dealers or heavy equipment leasing specialist have to help sell a dump truck. The sellers are frequently ready to be flexible and creative to help the buyer finance the truck. Even used dump trucks are valuable as collateral for financing. Some private sellers will carry a second note on the truck to help a buyer get financing started.
Dump truck financing with a large down payment. A large down payment of 20% or more encourages lenders to be more flexible with terms and interest rates since the buyer is making a strong commitment to complete the financing. The purchaser has more to lose if the financing involves a large down payment from the purchaser. Also, the lender incurs less risk than dump truck financing with a low or no down payment.
Financing with the use of additional collateral. There are commercial truck financing specialists that understand the business better than most commercial lenders and are willing to accept other collateral to help fund a dump truck purchase or lease. These specialist can accept other heavy equipment such as earthmovers, front end loaders or even real estate as collateral to finance a dump truck. Some of these specialists can even review the projected increase in business earning to help get more favorable interest rates and payback periods for the purchasers.
