All You Need To Know About Commercial Truck Repair Financing

Published October 13, 2020 by WC Team

All You Need To Know About CommercialTruck Repair Financing

Whether it is an independent or commercial owner, every vehicle can benefit from repair financing. You know that your livelihood is at risk when you find your commercial truck is damaged or out of service. 

Many small commercial trucks own companies that cannot afford to buy new commercial trucks for their business. Their entire livelihood and business depend on driving the trucks on the road in a working condition.

Commercial Truck Repair Financing is one of the simplest and fastest solutions that will help you get back on track in the minimum amount of time. Commercial Truck Repair Financing provides you with a specialized and sufficient loan that will cover all your repairs costs. Moreover, they are also accessible to borrowers who have a lower credit score. 

Why And What Do You Require For Commercial Truck Repair Financing?

The commercial truck repair financing option is made available to cover the expensive costs of maintaining semi-trucks and trucks. Although you may take a business loan for your vehicle, you may be at an advantage when you deal with a specialized commercial truck financing provider. 

No matter what your credit score is, they will look into the overall score, and sometimes, the experience in commercial driving can also be taken as an asset for providing you with truck repair loans.

The process of getting commercial truck repair financing is like any business loan with some additional requirements, such as truck licenses. Many Truck repair lenders would look into your business banking history and overall credit score to determine your trucks' exact and worthy rate. 

It is important to keep some of the documents ready when you apply for truck repair financing.

  • A commercial driver’s license
  • Phone/Mobile Number
  • Valid proof of insurance
  • Tax returns or bank statements

Apart from that, make sure you choose the right truck repair financing option for your commercial truck.

4 Best Options To Get Truck Repair Financing

If you are confused about where to look for your commercial truck repair financing, below is the list of where you can choose the best option according to your budget and requirement.

Using An Equipment Leasing Company To Finance Truck Repairs

If you own a vehicle or any other equipment that you can use as collateral, then an equipment leasing company might prove to be a great option to finance truck repairs. However, truck repair financing terms and rates will depend entirely on the credit scores and profiles.

You might face three challenges when you opt for an equipment leasing company:

  • Your collateral equipment must provide you with enough value to finance the truck repair.
  • To evaluate the equipment, the company uses liquefaction values or auction. That will lead to a 50% less worth value of the actual worth of the equipment.
  • You will find no benefit in paying the financing early with the leasing company. 

Small Business Term Loans

If you have been working in the commercial truck business for a minimum of 2 months and have gathered a collective credit score of more than 500, you are eligible for a small business term loan.

With this feature, you are at the advantage of borrowing almost twice your actual monthly revenue. Also, you will repay the loan in ten years with no penalties on prepayment. However, the arrangement for payments may considerably depend and vary on the basis of the credit profile.

Using Working Capital Loans For Truck Repairs

If you require money for your truck repairs on an urgent basis, then working capital is a good option for you. Many working capital lenders offer short term repair financing, provided on an equivalent day in 24 hours.

Working capital usually works on the model of daily payment. The money will be debited from your account during the week during the period of 6 to 12 months.

The only challenge that the borrower might face with working capital is the size and the amount of payment. In other words, an advance payment that can be repaid in 6 months might end in daily grossing of payment, draining the liquidity value of your business. Moreover, the APR or annual percentage rate may range from 50% to 200%. We found that these handful of lenders provide specific programs aimed at commercial trucking companies: Cardiff, Financial Pacific Leasing, and  Amur Equipment Leasing.

Finance Your Receivables With Factoring

In general terms, receivables are the money that somebody owed to you for the already completed work. Taking advantage of a factoring company might get you the money for truck repairs if you hold on to the receivables.  

Factoring is a process that works when the receivables are paid off in the form of invoices; they offer a portion of the money for repair at the earliest or on an equivalent day. The only drawback is that you must have an honest relationship with the factoring company. Otherwise, it might be a challenge to transact money and could even take 1-2 weeks for the transaction to finish.

Apart from these 4 options, you can also consult and obtain a second opinion from traditional banks and visit the truck repair shops. 

With traditional banks, the borrower can receive an honest amount and terms compared to the other commercial truck repair financing program. But you would possibly require a high credit score to be eligible for the repair loan.

You can always inquire about the repair loans from a nearby truck repair shop in your area. That might be easy for you to navigate and to be in constant touch with the shop. Make sure that you simply read all the terms and conditions before signing on the agreement.

Final Thoughts

Commercial Truck Repair Financing is a perfect solution if you would like a valuable amount of cash to buy truck damages. Many truck financing companies propose a spread of services, including commercial truck financing, semi-truck maintenance, 24X7 roadside assistance, and competitive truck repair loans. 

There are numerous options available for you to think about the simplest commercial truck repair financing programs to revive your broken truck. Many of those options cater to the truck's poor credit scores also. Moreover, you'll search for the alternatives to those programs via taking a loan from the truck fix-it shop or traditional banks. 

Are you a business owner? Apply for financing. Start Now.

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