So I might have truck soon and have options

Discussion in 'Ask An Owner Operator' started by peabody747, Aug 1, 2022.

  1. peabody747

    peabody747 Light Load Member

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    So as title might have own truck real soon just trying to square away financing. My options to run is to bring it on to current company which they have easy dedicated good paying freight. My buddy has his own authority and seems excited to start it out with a factoring company basically cause they only charge 3 percent. Current company would charge 15 percent.

    I'm curious I know on here most seem to be against factoring companies and I'm wondering why that is?
    I would also maybe consider something like cloud trucking as well but I'm not sure how difficult it is to file a trailer currently .
    thxs for any shared info
     
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  3. Siinman

    Siinman Road Train Member

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    Did you see that Factoring company that just went under and took all the money? Just one of many reasons to not use them. You can get 1.5 or free quick pay most of the time. Not worth it at all in my eyes.
     
  4. Oxbow

    Oxbow Road Train Member

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    Educate me please.

    3% saves 30 days on average, true? Isn't that like paying 36% APR? If cash flow is necessary, wouldn't you just be better off borrowing one month of operating expenses at 5 or 6 % from your local bank?

    I just don't get it.
     
  5. bzinger

    bzinger Road Train Member

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    The freight market is headed into a downturn and unless this truck is dirt cheap I'd not buy a truck now .
     
  6. Midwest Trucker

    Midwest Trucker Road Train Member

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    Factoring is like a drug. Easy to start, hard to stop.

    As far as “easy dedicated good paying” freight. Those four words almost never go together. FYI.
     
  7. peabody747

    peabody747 Light Load Member

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    spot market is moving back to contract freight, im with a company that has good contracts. The market always fluctuates and probably in your opinion there nevever a good time to buy a truck. I'm out here doing this crap for 25 percent why should I not go for 85 percent or better. And yes its a fair price for the truck
     
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  8. bzinger

    bzinger Road Train Member

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    Good luck .
     
  9. Ridgeline

    Ridgeline Road Train Member

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    If you are not capitalized in full for 60 days of operating expenses, you don’t need to be an owner. It isn’t difficult nor costly to save to get to that point to avoid the use of a factoring company.
     
  10. Oxbow

    Oxbow Road Train Member

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    Understood, but doesn't address my question.
     
  11. skallagrime

    skallagrime Road Train Member

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    That would be better than factoring, but still has you not actually capitalized, easier to climb out of, but no real cash in the bank means youll owe someone money instead of pulling from reserves.
     
    singlescrewshaker and Oxbow Thank this.
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