Thinking of to buy a big rig, it is great experience, but lots of work needed. Truck loan providers are sitting everywhere almost in every plaza. But you need to find out the best one. I tried to make the process simpler for you. Truck loans always tricky, need to consider a lot, hidden costs, interest rates, cancellation penalties, open or closed loan, down payment requirements, bank or private lenders, etc. write down these things and then explore as per your needs.
FINALIZE YOUR REQUIREMENTS
Decide what exactly you need, depending upon what type of work you are doing, like local or highway, heavy haul or light freight. For local general freight work to heavy haul, you may be good with $20000 to $50000. You will be good with 10 year old tractor which cost you no more than 50000.Looking at local truck owner operator rates, buying a new truck is not worthy. So if you are putting 10% down you will be borrowing 18000 to 45000. On an average, your installment may be from 400 to 1000 a month for 60 months. For long haul truckers loan amount may be in between 70000 to 160000. Again depends upon the work heavy or general freight, you need to borrow. Installment varies from 1500 to 3000 per month.
USED TRUCK V/S BRAND NEW
You might need new equipment to run on highway. Most flatbed owner operators prefer new equipment. There is less interest on new equipment, because banks directly finance new trucks and bank rates always cheaper than private lenders. As I said earlier as an owner operator, it is not worthy to buy new truck for local work. Mostly the amount you pay for maintenance of older truck is equal to brand new tractor installments. So why to driver older on highway, have a brand new.
OPEN LOANS, CLOSED LOANS AND PENALTIES
It is always better to choose open loan, you can pay off any time, less cancellation penalties, and borrowing options are more. The disadvantage of open loan is more interest rates. Closed loans are better if you are committed and buying new tractor trailer. Always as for loan cancellation amount before signing any paperwork. Another name of penalties may be loan closing cost, so find out it before doing any commitment.
Finally I can say just shop around, visit local truck loan providers and online quotes. There are so many websites providing heavy equipment loans. Do not share your credit information to anyone try to authenticate the information source.