While the current financial climate is more favorable for truckers than some other professions in the logistics industry, many banks are still reluctant to give out loans and financing for owner-operators. Sometimes it is better to get commercial truck financing rather than approaching a lender since the truck itself makes for excellent collateral.
Start by considering the benefits of purchasing a used truck rather than a new model. Since a brand-new, straight off the factory floor eighteen wheeler can cost as much as a quarter million dollars, it represents a major investment for any driver. What's more, a new truck loses tens of thousands of dollars in value the second that it rolls off of the dealer's lot. With the glut in truck purchasing, however, it has never been easier to buy a used eighteen wheeler. Prices are low that the saved money can be used towards a down payment or upgrades for the truck's interior.
Remember the expenses that will prevent you from being able to be pay off large amounts of the truck at once. One of the major concerns for any trucker in any eighteen wheeler is the soaring costs of gasoline, costs that are sure to keep steadily increasing in the near future. The expense of transporting freight makes it difficult from making regular payments towards a larger commercial loan. Start small rather than going for the highest-end option.
Like any other type of loan or insurance, you need to look around at multiple sources in order to get the best rates available on commercial truck financing. Prime lenders will give good interest rates for truckers with quality credit. Remember that lenders are always looking for customers with good credit, so do not be shy about refusing offers. Those whose credit is less than stellar, on the other hand, should check around with different financing companies. Since sub-prime loans also apply to vehicle payments, you can apply for one to pay off your trucks financing.
Prepare everything you need for commercial truck financing so that you will have documents on hand for the final approval. You will need a down payment that can be anywhere between 10 and 20%, so the less expensive the eighteen-wheeler, the lower the down payment will be. Bring your license and proof of hauling contracts so that the lender knows that this enterprise will make money. While lenders can directly access your credit score, it never hurts to bring along a hard copy.
- Guest Writer
Contact TruckMaster if you'd like your post to appear on this blog.
If You're Not Buying Trucks Now, You'll Hate Yourself Later.
The recent economic events have brought a great amount of uncertainty to the financial markets, but they have also brought a number of more personally relevant changes that are not often mentioned on the news. For example, the prices of commercial vehicles have begun to increase dramatically due to the changes in the market place and the financial markets around the world.
As people begin to tighten their wallets and knuckle down, the prices of all kinds of commodities and vehicles have begun to increase, including those of heavy duty trucks like Freightliner trucks or Kenworth trucks. This article will discuss some of the reasons why now might paradoxically be the best time to buy trucks despite the financial uncertainty that seems to be everywhere.
The reasons behind the price increases in commercial trucks are not intuitive, but with a bit of thought, they do make sense. When the stock market becomes less stable, the typical actions taken by people and businesses are not that different: both tend to stop buying, producing, or spending in general. The approach taken instead is to wait and see.
This means that fewer trucks are going to be made as manufacturers wait to see what the market will do. It also means that dealers are likely to increase the prices of the trucks they already have as a way of making sure that they will still make some money even if the markets continue to be unstable. What this means for the end user, such as a small business like a shipping or transportation fleet, is that it will become more expensive to buy the trucks they need to keep business as usual running.
Therefore, even though the natural thing to do when one does not know what the market may do from one day to the next is to sit tight and hold off any big purchases, the financially savvy thing to do is actually the opposite. If you need a quality truck like a Kenworth or a Freightliner, you should buy it now instead of later, because the prices of such trucks will only continue to increase in the future, and passing on a deal now might mean spending thousands of dollars more even just a few short months from now. Furthermore, getting a good truck now before prices start to climb higher will ensure that you make a reasonable purchase out of practicality now instead of out of desperation later.
Trucker To Trucker LLC
I think we are all glad to see the end of 2009 and start a new year, in fact a new decade!
It is also nice to see some encouraging signs from the leading economic indicators in the first two months of this new decade. The numbers are up, 1.2% in January and 0.3% in February. Manufacturing increased by 0.9% in December and 1% in January. These figures are directly related to our industry; freight movement has also been improving.
I have the opportunity to speak with a wide variety of trucking companies, freight brokerages, and logistics companies each week, and while far from scientific, the mood in general is shifting. Spring may not quite be in the air, but optimism is, and it is infectious.
Trucking companies are purchasing trucks to replace older equipment and for expansion. In some cases, they are simply taking advantage of amazing deals on equipment. Some companies are refitting their operations with different types of trailers so they can meet their customers changing demands. Many are purchasing or expanding their transportation management systems to prepare for increased business as the economy continues to grow.
With the shake up in 2009, many people have been moving around in the industry, finding new employers, or starting up their own companies. The results of these changes and realignments will be significant as we move forward into 2010.
How has your new decade begun? How do you feel the trucking industry has changed in the last couple of years and where do you think it is going? What changes are you preparing for?
TruckMaster Solution Provider
TruckMaster Your Trucking Company™
Those of us in the Trucking Industry have had an especially tough couple of years. Between the extreme fuel prices, immediately followed by the recession, I'm not sure that there’s an industry that has felt more of an effect than ours. "If it moves, it moves by truck" has an unfortunate side effect - when things aren’t moving, the trucks sit idle.
The attitude we read from the industry until very recently was not optimistic. TruckMaster lost some valued clients to the crisis, a few of which had been with us for many years. When discussing our software products with new potential clients, more often than not we’d be told that they needed and wanted our trucking software solution as it would increase their productivity drastically, but the very future of their businesses were in doubt. "Call us in 6 months, if we're still around, we will purchase your trucking software".
It seems to me that it's turning around now. We're starting to hear the optimism again. The constant rumble of bad economic news has slowed. The freight is starting to flow, the trucks are starting to move again. There's a sense felt by most that I talk to that better times are immediately ahead.
I’m not trying to imply that the crisis is over, we've got a ways to go, but my feeling is that we're on the downhill side.
My question for you is, do you see things getting better? Has your trucking business been improving over the last few weeks? Have you felt more optimism from those that you do business with?
It's been a tough year to stay optimistic in the trucking industry. However it sure beats the alternative!
Finally in the last couple of months we have had some positive signs that go beyond the “positive thinking” aspect that sometimes leaves you feeling like Dorothy clicking the heels of her red shoes wishing to go home.
The Commerce Department said orders for durable goods rose 1.8% in April, and another 1.8% in May.
While shipments continued a 10 month decline the longest on record (since 1992) the increase in orders is a good sign that while we are not out of the woods yet there are signs that shipments will start to pick up. The US Census Bureau in April stated inventories had been decreasing for six consecutive months , and that shipments had continued to slide. The combination of lower inventories, months of declining shipments, and two months of increased orders would indicate that there should be increased shipments soon.
It's not just the US that is showing signs of improvement either, Bloomberg reports that Germany's “manufacturing orders jumped the most in almost two years in May”. Also the World Bank upgraded its forecast for China's economy this year. Bloomberg also reported that Chinese manufacturing orders were starting to recover in April. While the recovery was not based on US exports it is a good sign.
Back in the US NPR reported that housing starts, and building reports jumped in June 3.6 percent. Also applications for building permits rose 8.7 percent in June. That has to be good news for flatbed trucking operations!
Not all the reports are positive for sure. For instance, Reuters published an interesting article stating in part that the Philadelphia Federal Reserve had lowered it's index of factory conditions in July after raising it in June. Over all the article ends up with a mixed bag of negative and positive measurements of the economy almost begrudgingly admitting that there might be a recovery in the works.
As we all know everything we use, wear or eat etc. came to us via truck. So any improvement in any segment of our economy is a great thing for trucking. We'll keep seeking out positive economic reports to post here on our Trucking Industry Blog. Please do not be shy about posting your own good economic stories here as well!
As we wrote on this blog at the beginning of the year, the best time to prepare for good times is during the slow times. If you do not already have good trucking software, freight brokerage software, or logistics software, this is the time to call TruckMaster. We can custom fit a solution for your company, and get your staff trained and ready for the coming recovery. Then you will be able to have everyone focused on maximizing the profits of your company taking full advantage of all the opportunities.
Call us today for a free demonstration.
TruckMaster Solution Provider
TruckMaster Your Trucking Company™
:: Next >>
|<< <||> >>|