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I have never financed a truck purchase, what do I need to know?

Know your credit history.
Unless you've been living in a cave for the past few years, you are aware of the "credit crunch." All financial institutions are playing by the book, literally. Your credit history and current finances will play a significant role in determining how much you will qualify for, how much equity is required and what kind of interest you will pay. Most Lenders use your "D & B Rating" to score applicants. To learn about your company's D & B Rating, how to monitor it, and how to improve it - visit Dun & Bradstreet's website (we'll provide a link at the bottom)

Get your financials in order.
If you have a glowing credit history and an outstanding D & B Rating you might be lucky enough to fill out a basic credit application and get approved. More likely though, your Lender is going to require at least your last two years' Profit and Loss Statements, Balance Sheets and Cash Flows. TIP - If your financials have been audited by an independent CPA then they will carry more weight with the lender.

Plan on "putting some skin into the game".
Another reality of the credit crunch is that minimum equity requirements are being strictly adhered to. So, plan on putting some cash down on your purchase. Most Lenders are going to require at least a 10%, and very likely 20%.

Document what you are borrowing for.
Long gone are the days of walking into your Loan Officer's office, and getting approval for that next loan while having a cup of coffee and a doughnut. After all, the Lender wants to know if he can sell that piece of equipment if you default. Be prepared to provide detailed specifications of the equipment. At the bare minimum you'll need the make, model, year, VIN and mileage of the truck. You'll also need some information about the body, if it is a tanker have the year and size of the tank and the serial number.

Shop for Lenders.
If you are in the Energy or Environmental Waste Industries, and are possibly hauling Hazardous Materials, which some Lenders shy away from. For this, and other reasons, consider dealing with a Lender that specializes in the type of equipment that you need. We work with Capital Relay. They have been financing Tank Trucks since 1991.

Weigh your options.
Talk to your Lender about your needs. They can tailor your loan or lease to your exact situation. For example, let's say that you have a seasonal business so your cash flow is great 6 months of the year, but the other 6 months are not so flush. Have your Lender weight your payments accordingly, say with $99 monthly payments during the lean months. Other options are available, so don't be afraid to ask your Lender what options they offer.

Lease or loan?
If you believe that profits are made by using equipment, not owning it, then a five year operating lease might be the ticket for you. Consider all options from a cash flow and tax perspective!