For all of their functionality and versatility, there’s no denying that trucks and vans can be some of the most expensive vehicles used within businesses. With modern models costing over $20,000 in most instances, it’s not uncommon for companies to either go without these necessary vehicles, or consider their options as far as cash is concerned.
One of the most beneficial ways to pay for something that can be afforded, is by borrowing the sum from a third party lender, paying for the vehicle and then repaying what has been borrowed over a period of time that suits the borrower. This option is usually referred to as a loan, or finance, and it can make all the difference to the way in which a business is able to operate.
The Best Ways to Finance a Truck
Most borrowers will be given three options when applying for cash from a bank, or from a lending company. The first will be to provide a deposit, typically amounting to 10% or 20% of the total sum that is due to be borrowed. This option is a great way to minimise the overall cost of the amount that needs to be paid back.
The second solution is to use assets that can cater to the cost of the deposit. This can help to minimise the initial amount of cash that needs to be paid by the borrower, whilst reassuring the lender that their investment will be secured. Both parties can benefit, as the need to pay cash upfront is all but eliminated – whilst providing the lending agency a way to reclaim what they lost if the agreement fails to work out in the future.
The third and final option for truck financing is to use the applicant’s credit score to both negate the need for a deposit, as well as the need to secure the loan. This type of option is referred to as an unsecured loan and it is ideal for businesses of all sizes with an impressive credit report. This proof of meeting payments is more than enough reassurance for a bank, and as the borrower will undoubtedly want to maintain their score, the lender will be able to trust that they will meet their repayments.