The trucking industry in Surrey is a huge business, with an incredible 80% of all cargo transported by trucks. In order to compete with larger companies, small trucking business owners and operators often need reliable access to credit in a hurry to help them buy trucks and equipment and handle start-up costs and miscellaneous cash flow gaps. Truck loans Surrey are a popular way for business owners to handle these and other cash flow challenges.
In this guide, we’ll discuss the workings of truck loans, how business owners can use them, the pros and cons of getting a truck loan, and other alternatives to consider when it comes to financing your trucking business.
Ready to learn everything you want to know about truck loans? Let’s go!
What is a Truck Loan?
A truck loan is a financial product that allows you to purchase a truck, car, or other commercial vehicle for your business. Typically, borrowers seek truck loans from their automobile dealer or a major bank. The most common use for a truck loan is purchasing or refinancing the purchase of a commercial vehicle.
Why Do Small Business Owners Need Truck Loans?
Trucking is a prosperous industry. As long as there are goods to be delivered, the trucking business will need them.
Although there is a lot of money to be made in the trucking business, it is expensive. One reason is that good employees are difficult to find and keep. Truck driving is a demanding, time-consuming job, and the drivers are often expected to stay away from home for long periods. Employers must offer their employees competitive benefits and compensation to earn their loyalty.
If you run a small trucking business, just making payroll can become a huge issue. This is just one example of why a small business owner may turn to truck loans. This is where Sandhu & Sran Mortgages can help! We will provide you with customized solutions, ensuring you a seamless experience!
Pros of Getting Truck Loans
Getting approved for truck loans can benefit small business owners in several ways, including these:
Financial Flexibility
Business owners can access extra cash flow to cover any unforeseen expenses that their business might face. Entrepreneurs can use these extra funds to handle business-related expenses like purchasing equipment, maintaining vehicles, paying employees, or filing taxes. This flexibility comes with any additional funds, not just truck loans!
Ownership
Truck loans Surrey make more financial sense than leasing or renting a truck since you will get to keep the vehicle at the end of your loan duration.
Growth of the Business
With extra funds, business owners can focus on driving business growth instead of feeling bogged down by daily emergencies. This improved financial runway can enable business owners to plan for future expansion.
Cons of Truck Loans
Business owners should consider the following downsides when it comes to financing truck loans:
Collateral
As with most types of financing, most lenders will look for collateral before approving a truck loan for a small business. The need for collateral is not unique to truck loans and can come in various forms. For example, you can use a new or existing vehicle (like a car, truck or boat) to help you get financing for another vehicle.
Pro-Tip* Talk to your Mortgage broker about which types of collateral they will accept.
High-Interest Rates
Due to the risks involved in a trucking business, many lenders have high-interest policies with which business owners have to comply.
Credit History
Most lenders look at the home equity line of credit Surrey as well as the borrower’s credit before approving the loan. If you have poor credit, getting a loan approved is tough.
Wrap Up
As a trucking business owner, we know you have a lot of reasons to want convenient, reliable access to extra capital. From buying and maintaining trucks to making monthly payroll, there’s always a place for additional cash. Sandhu & Sran Mortgages can help you get the most out of everything. Contact us and enjoy the royal experience!