Business Loans For Trucking Companies
Regardless of the economy people will always need a way to transport goods. Owning a freight trucking business can be very profitable for you because this is an import part of our economy.
Repairing trucks is an obvious expense. You may have some employees damaging your equipment from time to time so this must be added into expenses. Below we have listed some information for trucking companies who are seeking loans.
Loans for Trucking Businesses
Trucking business owners must decide their timeline to payback the loan before they take their loan offer, this is the best way to plan a repayment.
SBA (Small Business Loan)
This business is backed by govt. agencies and provided by private lenders. Interest rates are usually below 10 percent. For trucking companies needing to purchase multiple trucks or pay for expansions, a small business loan is a good option. Repayment terms can last up to 20 years, and it is possible to finance a considerable amount of money.
Merchant Cash Advance (MCA)
For a sudden financial emergency, a merchant cash advance is a great option. MCA Fees can run very high so this form of financing only makes sense if it can be quickly repaid. The main benefit of this type of loan is having the cash instantly regardless of credit history. Its important to only use the MCA for emergencies.
Working Capital Term Loan
Regular income is considered collateral with this secured loan. For this reason, you don’t necessarily need to have perfect credit in order to get approved. With interest rates lower than a an advance its a better way to borrow if you qualify.
If a trucking company wants financing without pledging collateral, a business line of credit is another option.
Qualifying for A Business Loan For Your Trucking Company
In high-risk industries like freight transport, acquiring loan funds can be notoriously difficult. The following are some of the added responsibilities that a trucking business owner has:
Monthly Revenue Minimums
For optimal financing options, you’ll want to show a minimum of about $9,000 in revenue each month. This is important for most loans: you must demonstrate your ability to repay the loan.
It’s extremely important to have adequate and updated insurance on all trucks as well as inventory. Lenders are more likely to offer business loans to trucking companies that have great insurance.
Business Credit History
It’s important that you’ve been in business for at least 6 months for most lenders, some require more time.
Trucking businesses that meet the above requirements should be in a good position to get the funding that they need.
Reach out to one of our reps at Grow Business loans for more information.
- On March 15, 2019