When to Consider Trucking Equipment Leasing in Place of Financing
The truck requirements can be difficult for owner-operators or startups to the stomach, as the costs would be more than what you have to afford if you are to buy an older rig with more miles.
Equipment financing is designed for expensive tools and machinery which can serve as collateral and is the least costly option for this kind of financing. However, it cannot be used for other business working capital purposes.
Business owners in need of a truck but not able to afford the financing option due to the latter’s compulsory high down payment conditions may want to think about equipment leasing instead. Several kinds of equipment leasing are available, but you will usually require a credit score of at least 680, and must have been in business for two years at the time of applying. The lease will have anywhere between 8% and 18% interest on average, although it can be more expensive occasionally. Nonetheless, equipment leasing is a good option, especially if you do not have sufficient collateral.