It’s no secret that financing a semi-truck is expensive, but it’s also necessary. If you need more cash to buy a new or used semi-truck, it’s best to take out a loan.
Here’s why you should finance your semi-truck and how to get the most out of your equipment financing agreement. You will also learn tips for negotiating with lenders, including questions to ask before you finance your semi-truck.
Why Finance Your Semi-Truck with an Equipment Loan?
When it comes to financing your semi-truck, there are a lot of options. An equipment loan is one of the most popular, which allows you to finance your truck with lower interest rates than personal loans.
Equipment loans also offer quick application turnaround times, usually 24 hours or less, and provide access to a wide range of financial products and services. You get the money when it’s necessary. So there’s no need for collateral.
How to Negotiate the Best Semi-Truck Loan Rate
There are ways to negotiate the best interest rates for your semi-truck loan. Here are tips to help you get started:
- Ask for a lower interest rate. The average interest rate on semi trucks ranges from 5% to 30% annually. If you have excellent credit, it might be worth going through the effort of asking your lender for a lower rate. This can save you thousands of dollars in interest over the life of your loan, so it’s worth trying.
- Ask for a longer term. Longer terms mean lower monthly payments and less stress on your finances. So opt with the longest term available if you can afford it.
- Ask for lower down payment requirements, if applicable. Most lenders require borrowers to make at least 10 percent cash down when purchasing their new trucks with financing from them, which isn’t always an option for buyers who can’t meet the requirement. However, some lenders offer alternatives, such as putting less cash down while still qualifying under certain conditions, such as being able to afford higher monthly payments because they’ll adjust other terms based on financial levels.
The Complete Guide to Financing a Semi-Truck in 2022
If you have your heart set on buying a semi-truck, it’s time to start the financing process. While there are many different ways to finance a semi-truck, you should consider some important factors before getting started. Here’s what you need to know about financing your semi-truck:
- How much does it cost? The first step is figuring out how much you can afford to spend on your new vehicle. According to experts, you shouldn’t spend more than 20% of your total car expenses or more than 10% of your net income. Most banks will require proof of income or assets as part of their underwriting process, so ensure everything is in order before applying for financing.
- What kind of loan am I eligible for? There are several types of loans available depending on how long you want the term length and how much down payment money you’re willing or able to put toward purchasing your vehicle. The main difference between these options comes down to the interest rates lenders charge.
Conclusion
If you’re looking to finance a semi-truck, there are many options. These lenders offer solutions that can accommodate virtually any need. With so many companies to choose from, with competitive rates, apply the negotiating tips to land lower rates. Consider the guide to financing your semi truck financing, so you can decide which lender is a good fit for your options.
Disclaimer: MoneyMagpie is not a licensed financial advisor and therefore information found here including opinions, commentary, suggestions or strategies are for informational, entertainment or educational purposes only. This should not be considered as financial advice. Anyone thinking of investing should conduct their own due diligence.
