A sudden breakdown of pickup trucks is very common, but the repair cost could, unfortunately, harm your budget. If you put off the repair work, it will cause huge losses to your business. Many of you lack sufficient funds to carry out truck repair work.
Thankfully, there is nothing to worry about, as you can borrow money from a truck financing company. The repair cost could be very high, and chances are your savings do not have money to carry out such repair work.
Although you can seek pickup truck finance to get your truck repaired, you will have to meet the criteria to qualify for the loan. Exerts always suggest stashing away a lot of money so you do not need to rush to your lender to fund the repair work. It can increase your financial problems.
If you have already taken out a loan to finance your pickup truck, it will be more difficult to manage payments along with the debt for repair work.
Basic requirements to meet to get the repair work done
If you have got a damaged pickup truck and you are looking to finance the repair work, you will have to meet the following criteria: business.
- Original truck documents
Before you reach out to any financing company to borrow money to get your truck repaired, the financing company would want to check all truck documents to ensure the truck belongs to your business.
They are particularly keen on checking insurance papers, commercial driving licences, emission certificates, and MCS-90. Without these documents, no financing company will trust your credibility. In fact, they cannot trust that you will pay back the debt if you do not provide all relevant documents.
Apart from this, you will need documents related to business registration and tax payments. It helps a finance company to trust your business. You are more likely to get money with ease when you have all these documents.
- Your banking history and credit score
The next step for your finance company is to collect your bank statement. They would want to know the status of your revenues and business expenses. This helps the company to decide how much it is safe to loan you. It is likely that you get approval for less money than you need for the repair work.
This all depends on your revenues. The financing company would determine the size of the loan based on how much revenue you have left after meeting your business expenses. Another factor is your credit score, which determines the size of the funding.
You should have a decent credit score to borrow a higher sum at affordable interest rates even though the ender advertises affordable rates for poor credit people as well. Some asset finance companies in the UK can offer you funds despite a poor credit score but interest rates will be slightly higher.
What are the other factors considered?
Some other factors are known for affecting your ability to borrow money to finance the repair work of your truck.
- The age of your truck
A truck finance company will take into account the age of your truck. The older your truck is, the more expensive the repair work will be.
Most of the finance companies will not entertain your application if your truck is older than 10 years. The repair cost will be expensive, and sometimes the repair parts go outdated because of the change in technology.
- Your truck’s mileage
Your financing company will consider the mileage of your truck before deciding the amount for the repair work of your pickup truck.
The less the mileage, the better. You will have a greater chance for getting the repair work of your truck financed.
Tips to get a suitable company to get a repair work
There are four types of financing companies you can turn to. These include equipment leasing companies, factoring companies, small business loan providers and working capital loan lenders. Here is how you can decide which of the companies will be best suitable for you:
- Equipment leasing companies
These companies may require you to put down your truck or something as collateral. The advantage of using these companies is that you can get money at a lower interest rate despite a poor credit report. The value of the collateral must be worth the same as the value of the truck.
- Factoring companies
Factoring companies can let you quickly access funds to have your truck repaired. You will borrow money against your unpaid invoices. You will get the money based on the value of unpaid invoices minus the fees of the factoring company.
You do not need to worry about your credit score, as the factoring company will check the credit rating of your customers.
- Small business loan lenders
Small business loans can come in handy when you need money to have your truck repaired. The loan amount will be determined based on your credit score and business revenues.
- Working capital loan lenders
You can also turn to working capital loan lenders to fund the repair cost of your truck. What makes these loans different from others is that you will pay back the amount daily, so you can quickly get rid of debt.
A fixed sum of money will be deducted from your working capital for a fixed period of time, probably up to 6 or 12 months.
To wrap up
Pickup truck repair financing is possible from different types of financing companies. It is always suggested that you maintain a decent credit score so you get lower interest rates. Do not forget to arrange all business documents and make sure your business earns high revenues.
Choose a reputed broker who could introduce you to the best financing company that matches your business requirements. They will perform the whole legwork on your behalf in exchange for a small brokerage commission. This will help you get the best deal that is not possible otherwise.
Harry Kane is a financial writer and author who has covered wide topics related to business loans and finance for the last decade. He has been working as the Chief Contributor in finding out deals on various business finance products covered by Thebusinessfunds, a reputed business loan broker firm in the UK. The primary work of Harry is to analyse the loan requirements of various businesses according to their circumstances and affordability. He directly communicates with the loan aspirants and guides them to get the right loan matching their needs. He has a vast experience in finance writing, working with many major business firms in the UK. At Thebusinessfunds, Harry also used to write well-researched blogs covering the financial problems of business loan aspirants and providing relevant solutions. He is a postgraduate with MSc. in Banking and Finance.