Things To Know When Applying For The Truck Loans

Obtaining the truck loans is not easy. Most lenders do not provide complete information upfront. They simply want you to apply first so they can determine the loan terms and conditions that are in their favour. However, if you complete this process as required and then find that you are not eligible for their loan or there are hidden charges, you will be wasting your time. Do your homework properly and research the truck loan providers before applying to a particular lender. More importantly, you should first gather all information about your business, finances and credit position.

The down payment and the loan repayment amount are the first things any loan borrower wants to know. You are unlikely to get straight answers to these questions immediately. There are hidden charges and fees associated with a commercial truck loan. It is difficult to find information about these costs. First of all, you have to inform the lender what type of commercial truck you are planning to buy. It is important to know this information in detail. There are different types of commercial trucks and each one is sold with or without many attachments. You should clearly determine which truck and what type of its attachments you plan to finance with the loan. You have to inform what purpose the truck will be used. Apply under the right category of truck loans. For example, if you will be using a semi tractor with a dump trailer, it is a transportation truck and not a vocational truck. In such a case, apply for a vocational truck loan.

Most truck loan lenders will not finance trucks that are more than 10-15 years old. However, there are lenders that specialise in financing of old trucks. If you are planning to finance a very old truck, apply for the loan to the right lender. You should know how much down payment you are ready to pay. This payment may not be required if you have a good credit, cash flows and business track record. Long haul trucks are difficult to finance compared to the vocational trucks. Some lenders do not give loans to the owner-operators who have been in this business for less than two years. Do your research on all these aspects of truck loans before applying to any lender. Be ready with the information that truck loan lenders require from the loan applicants. It will speed up your loan application process.

Finding The Best Truck Loan

There are plenty of truck loans out there, but finding the best one takes some research. Of course, your local truck dealer is an obvious place to start, although there are also plenty of online resources, including sites that compare different loan options, saving you time and making the process easier.

Your credit score makes a big difference to the interest rate that will be offered to you on a truck loan; even a small difference in your score can mean higher monthly payments and repaying a larger total amount over the term of the loan. There are various lenders that specialise in car and truck loans for those with bad credit, but it’s worth trying to boost your credit score before even applying for a truck loan, if possible.

It’s also important to figure out your budget and what you can afford in terms of a truck and the payments. In addition to the interest rate, there are other factors to consider; most dealers will require a down payment of at least several hundred dollars, although the more you put down, the less you’ll end up paying each month. Many experts recommend a down payment of at least 15 percent of the total truck price.

And the length, or term of the loan is also a factor; payments are lower when spread over a five or six year term, although in the long run you will end up paying more. A shorter term means higher monthly payments, but it will take less time to own the truck outright and it can also prevent you from owing more on the truck than it’s actually worth.

Negotiating with your dealer is not only acceptable, it can be an effective way of keeping the cost of the truck down. Most dealers want to sell trucks instead of having them take up space on the lot and the finance department often has the authority to make a deal or match a competitor’s offer, especially if it’s towards the end of the year and they want to get rid of as many trucks as possible.