Truck Financing Questions ?

I will be glad to help you with the financial planning.

Do you still owe $30,000 on the truck or on a personal/credit card loan or both (how much on each?).


'He made about 250 last year'

I assume that $250,000 is gross. Hope this equals at least 75,000 net.

How much did you mange to pay off of your loans last year (truck and/or other?)





-------------
I charge a one-time fee of $50,000 for “The Ultimate Financial Advise!”
None of my clients have ever paid the fee to get this priceless advice….
I am strongly considering paying myself the fee and taking my own advice!
In the mean while I am still offering my services to new clients.

 

I am currently driving for and owner op out of Baltimore Maryland with Atlas Van Lines. I have permission from my driver manger to purchase my own truck and they will have contracts for me. I have the option of purchasing the current truck I am driving and have also looked at a couple local.

The thing I am worried about is financing. The company will help with insurance & tags, fuel will come out of settlements. I have a bad credit history, but my credit is improving. I can manage this business and my wife also has a cdl and is good with money management.

I would like to know what you think my best option for finance would be? I was thinking about getting an estimate of operating costs throughout the next three months and applying for a small business startup loan through my local bank. There are many other options I am sure.

Please PM me if you can with your response. Thanks.

 

I am newly married to a trucker husband who is very bad at explaining things to me. I am very scientific and he is not specific enough when he tries so I just get frustrated. or maybe its because he uses terms I do not understand without explaining them.... I don't know. Here is the situation:

He currently is a driver for company. He is on the road for about 9 weeks at a time. We are looking to buy a truck so he can drive more local and make his own hours. He has been in trucking for over 20 years and was an O/O in the past. We both have 'good' FICO scores, though his is better than mine (but only by 15 pts) (each in high 600's).

We have applied for financing through a specific company that will send out the request to individual banks. The first two banks denied us. We do not really understand why, and the company will not tell us. Do they have to tell us if we ask?

He is now talking about a buy here/ Pay here kind of place and I really do not like that idea. Are there other options?

He was trying to explain something to me about leasing. And I kept asking about interest rates. He said something about the interest rate being worked into the loan? If I understand this right there would be no benefit to paying the loan off early. Am I understanding this right?

I read some of the prior postings in this thread. (but 13 pages are too many for one night.) some people have mentioned a lease with a buy out. How does that work? What does that mean?

I am having a hard time understanding this.. and while he may have 2 decades in the profession; I have had less than a year to understand this... and I am confused.


Thank you
Lady Evey

 

Unfortunately in this market a good credit score is over 750. In addition, a truck loan can be one of the hardest to get. They don't have to tell you why they denied you but you can get a copy of the credit report they used to make their decision. You credit score; amount of credit available versus percentage used and percentage of payment versus income are some major factors. Sometimes a business plan or a lease agreement will help or be required to get financing.

You need some operating capital to ensure your success. IMHO, you need $8,000 - $10,000 to start. You can start with less but you are one mistake or break down from failure. If you have $3,000 - $6,000 for a down payment, a lease agreement with a company and/or a business plan you should be able to get financing.

I wouldn't enter into a lease agreement with a buy here/pay here place if at all possible. These will be leases not purchases and the rules and terms are very different. If you purchase and finance equipment, it will be in your name with a lien against it. If you lease it will be in their name until the contract is fulfilled and the buyout takes place.

While it is unfortunate, most drivers and many owner/operators don't understand the business end of trucking. If you ask ten owner/operators to explain their cost of operation and how much profit they make, I would be floored if you could find four that could answer these questions.

If you want to learn and understand the business, there is enough good information on this forum. It will be a lot more reading than 13 pages though. Read all the docked threads in the "Ask An Owner Operator" section. These are some great threads too:

http://www.thetruckersreport.com/truckingindustryforum/ask-an-owner-operator/146942-how-to-become-an-owner-operator.html

http://www.thetruckersreport.com/truckingindustryforum/ask-an-owner-operator/147854-what-would-experienced-o-o-buy.html

http://www.thetruckersreport.com/truckingindustryforum/ask-an-owner-operator/125507-what-estimated-operating-costs-o-o.html

http://www.thetruckersreport.com/truckingindustryforum/ask-an-owner-operator/148340-keeping-track-o-o-operating-costs.html

http://www.thetruckersreport.com/truckingindustryforum/ask-an-owner-operator/134211-no-experience-but-getting-authority.html


http://www.thetruckersreport.com/truckingindustryforum/ask-an-owner-operator/64679-my-numbers-o-o-leased-crete.html

IMHO, planning to buy your own truck to be home more is problematic at the very least. You will have to run the truck when and where you can make the money to pay the payments. Have you already located a company to work for that will allow you to make truck payments and be home more? Do you have a Cost Of Operation figured out in CPM (Cents Per Mile)? Do you know what the company pay will be in CPM? If not, you should not be truck shopping yet.

 

Please tell us what a reasonable doc fee is for financing? We are looking at a finance contract, fixed rate, for 3 years on 40,000. The fee is quoted at $450. How are interest rates now. Credit is a medium grade, just a few late payments the first half of this year. We were quoted 13%.

 

Her's my Question/scenario.

I have had a Class B CDL since 2001. I want to get into trucking as an O/O.
I have been looking at trucks since early October.
Mostly on truckpaper to kinda get a sense for what to expect as far as price,model& mileage are concerned.

here is what I've run into; I've been told that since I don't posess a class A I will not get financed unless I (falsify) a credit application...Which i want nothing to do with.

So I have been told that paying cash is the only way to make it happen. is this true?

also I will need to get a trailer as well which is the major expense.

As soon as I get my complete rig together I have a company that will hire the truck. I laso have a driver ready to go,I have an average score of 650 with around $ 10 k. in personal debt not counting my Mortgage.

right now I have about $6k in cash but at the first of the year that cash figure will be closer to $30k.

I need a 1k cuft. pneumatic trailer, a 2005 or newer power unit with 500+hp. I have already made the purchase of a decent used G/D blower unit.

 

Here's another angle i have been considering. since i will be paying Cash,I need to keep the intial investment as low as possible.So what i am planning to do is find a truck that suits my needs and will get the job done I have been seeing trucks that fit this criteria between $20k and $25k.

Would it be possible to use the title on the Power unit as collateral against a loan for a trailer? most used trailers are in the $35k-$50k range.

Is there any helpful advise out there for someone in my particular position?

 

I think what I'll do is just keep my money and hit Richey bro's or some other auctions. For some reason I am starting to turn an eye towards a Mack CX613. It looks like a tough truck.

 

As a first time truck buyer, dealership is giving me 20% APR with $15000 down for 24 mo., on a $50k truck. I have a credit score of 740. Are these the rates for first time buyers now? This seams kind of high.

 

20% is way to high, if you read from the first post in the thread you will soon find this out.