Financing for newbies
- Thread starter Marmino
- Start date
Financing for new trucks is becoming exstremely difficult for any newcomers. Mant opt for a lease/purchase or owner financing on a used truck.
In addition you might find certain dealers to finance you but you must be cautious as they may have the truck priced way over what it is worth. They have to put their risk somewhere...either in the interest rate or the price of the truck.
I wouldn't give up the ship yet. There are many places to obtain financing including a Small Business Loan. I think ooida has some resources as well.
Remember though, most will be looking for 20% down. I have also heard many require numbers higher than that.
I would keep shopping, you might be surprised what you might find.
In addition you might find certain dealers to finance you but you must be cautious as they may have the truck priced way over what it is worth. They have to put their risk somewhere...either in the interest rate or the price of the truck.
I wouldn't give up the ship yet. There are many places to obtain financing including a Small Business Loan. I think ooida has some resources as well.
Remember though, most will be looking for 20% down. I have also heard many require numbers higher than that.
I would keep shopping, you might be surprised what you might find.
We're (wife and me) at about the same point you are regarding financing a new truck. I was shocked to learn the terms offered by the truck dealer. Looking into it further, I learned that first time truck buyers are lumped together as a group. Your personal assets and credit rating carry little weight.
The money folks know that a very large percentage of first time truck buyers fail to make their payments and the truck gets reposessed. They structure their deals to make money either way. If you make your payments at high rates, great, you are paying for the sins of the failures. If you don't, that's OK too. They have enough money up front and a high enough interest rate to come out ahead if they have to take the truck back. They are far more interested in their own financial success than they are in yours. You as the paying entity are as much a comodity to them as the truck itself. You are just an element in their formulas.
Keep in mind that the loan officers are not lending out their own money. They get money from bigger money suppliers behind the scenes. Just as you have to prove yourself worthy of a loan, the loan officers have to maintain a loan portfolio and profitability ratio that will impress the money providers. The lenders look first to the quality of their loan portfolios and only then to you as an individual. If you are a good credit risk, they'll gladly bring you on board at a high rate to boost their portfolio.
I hesitate to say we made better arrangements because we have not yet completed the final steps. But I believe we found a much better rate and terms elsewhere. We'll soon have the final quote on the truck we are spec'ing out. We'll take that in and apply for the loan.
I'd be happy to chat about this privately with you and compare notes. My e-mail is in my profile.
The money folks know that a very large percentage of first time truck buyers fail to make their payments and the truck gets reposessed. They structure their deals to make money either way. If you make your payments at high rates, great, you are paying for the sins of the failures. If you don't, that's OK too. They have enough money up front and a high enough interest rate to come out ahead if they have to take the truck back. They are far more interested in their own financial success than they are in yours. You as the paying entity are as much a comodity to them as the truck itself. You are just an element in their formulas.
Keep in mind that the loan officers are not lending out their own money. They get money from bigger money suppliers behind the scenes. Just as you have to prove yourself worthy of a loan, the loan officers have to maintain a loan portfolio and profitability ratio that will impress the money providers. The lenders look first to the quality of their loan portfolios and only then to you as an individual. If you are a good credit risk, they'll gladly bring you on board at a high rate to boost their portfolio.
I hesitate to say we made better arrangements because we have not yet completed the final steps. But I believe we found a much better rate and terms elsewhere. We'll soon have the final quote on the truck we are spec'ing out. We'll take that in and apply for the loan.
I'd be happy to chat about this privately with you and compare notes. My e-mail is in my profile.
Hi,
As a sales consultant...I get these kind of issues every day.
Most financial people will look at you...however you need to be prepared....
I'm not sure how far you went in the process buts here are a few tips:
Have a business plan ready !!! ...Lay out you projected income and expenses for the next year ( even 2 )
Have all your personal bills in order...if you are going to be a personal guarantor (i.e. you are signing for the business)...
Big concerns are your real estate and any prior vehicle loans.
Provide them with bank references.... ( i.e. anybody you have a good relationship with at your local bank)
Check into insurance...get a quote and a commitment if possible...and add that to your info packet
Present a professional layout...spend $20 to get it printed and set up....
Ask you dealer to present you loan package to everyone he/she uses..
Sometimes they will only go to 1 lender.
If you still have trouble...send me an e-mail...
I have several sources that my help...
Frank in Pa.
P.S. - Look into a TRAC lease as well...your initial outlay will be a lot less
"The Beast in the East"
As a sales consultant...I get these kind of issues every day.
Most financial people will look at you...however you need to be prepared....
I'm not sure how far you went in the process buts here are a few tips:
Have a business plan ready !!! ...Lay out you projected income and expenses for the next year ( even 2 )
Have all your personal bills in order...if you are going to be a personal guarantor (i.e. you are signing for the business)...
Big concerns are your real estate and any prior vehicle loans.
Provide them with bank references.... ( i.e. anybody you have a good relationship with at your local bank)
Check into insurance...get a quote and a commitment if possible...and add that to your info packet
Present a professional layout...spend $20 to get it printed and set up....
Ask you dealer to present you loan package to everyone he/she uses..
Sometimes they will only go to 1 lender.
If you still have trouble...send me an e-mail...
I have several sources that my help...
Frank in Pa.
P.S. - Look into a TRAC lease as well...your initial outlay will be a lot less
"The Beast in the East"