Purchasing a bucket truck with cash is something not many companies can afford, especially since the economy is still in a somewhat unstable condition. Even large businesses prefer to finance their fleet rather than exhausting a large portion of their capital for a single acquisition. Borrowing money is a great option for buyers who do not have the resources to buy the vehicle with cash.
So what are the steps that need to be taken to finance a bucket truck? Consider the following list of steps that will occur in the process:
Financing the Purchase
Generally, a lender such as a bank will loan money to the buyer for the purchase of the commercial vehicle so the buyer can procure the equipment with just a small down payment. The borrower will then repay the lender in regular monthly payments the money that has been borrowed, along with a set interest rate.
Unlike financing a house or a personal auto, it is uncomplicated to qualify for a loan on a commercial truck. It is usually easy to get approval from commercial vehicle lenders because this type of equipment is already in itself valuable collateral. The bucket truck is also a guaranteed income-generating piece of equipment, so there is minimal risk for the commercial lender.
Qualifying for a Loan
In order to qualify for a loan, the buyer must first have to find an appropriate commercial dealer who has the specific type of commercial truck needed. Some of these dealers already offer financing for the vehicles they sell, which makes financing even less of an inconvenience.
Decision Time New vs. Used
The next stop is to decide whether the purchase will be for a new or a used bucket truck. In the current economic climate, it is a wise idea to acquire a used bucket truck since it will have a lower price tag and will be less risky to finance. In addition, the value of a used vehicle will not depreciate as quickly as it does when purchasing a new vehicle.
When purchasing a used vehicle, always work with a reputable dealer. Used commercial vehicles are reconditioned before being sold. It is important to acquire a vehicle that will run for many years without a breakdown in order to get a good return on investment. For quality used bucket trucks, there are many excellent reconditioned vehicle dealers. Find one that specializes in reconditioned low mileage fleet trucks, if possible.
The company's credit score will play a large role when purchasing a used bucket truck. The credit score also greatly influences the interest rate of the loan. A buyer with a good credit score can apply for a loan at prime lenders to get the best interest rate available, while buyers with bad credit scores will have to shop around for sub-prime lenders that are borrower-friendly to get a reasonable interest rate. Remember that a credit score will be lower if it shows that several inquiries have been made by other lenders that do not cater to sub-prime borrowers and therefore have turned the buyer down for a loan.
Once a vehicle has been chosen, and a lender lined up to finance the purchase, the next step is to provide the required documents to apply for the loan such as proof of CDL, documents that prove income or income ability, proof of a good credit report and FICO score, and the required percentage down payment. Once all this has been supplied, and the loan application has been approved, the next step is to sign all of the documents and pick up that bucket truck. Then the real work can begin!