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How to Lease a Tow Truck without Breaking the Bank

Posted On: January 25, 2023 author Paul Kendall

Are you looking for a tow truck for your business? 

Have you ever dreamed of owning your own tow truck, the reality is that it can be a costly venture. 

Leasing a tow truck is a more economical option and isn't always easy either. With so many factors to consider, from financing to insurance, it can feel overwhelming at times. But with some patience and savvy research, you can lease a tow truck without breaking the bank. 

In this article, we will discuss the key elements involved in leasing a tow truck along with tips for getting the best deal possible.

 

Choose the right tow truck for your business

Choose the right tow truck for your business

Choosing the right tow truck for your business is an important decision that will impact your daily operations and overall success.

When selecting a tow truck, it's important to consider your specific towing needs and the types of vehicles you will be working with. For example, if you will be towing large commercial vehicles, you will need a heavy-duty tow truck with a high towing capacity.

On the other hand, if you will be mostly towing passenger cars, a medium-duty truck may be sufficient. It's also a good idea to research different models and features to find a truck that is reliable, efficient, and easy to maintain. Don't forget to compare prices and leasing options to find the best fit for your budget.

By taking the time to choose the right tow truck for your business, you can ensure that you have the tools and resources you need to provide excellent service to your customers.

Buying vs. Leasing a Tow Truck

 

There are many factors to consider when choosing whether to buy or lease a tow truck. The most important factor is typically the cost. When you lease a tow truck, you will have a lower monthly payment than if you were to purchase the same truck outright. 

If you are considering acquiring a tow truck for your business but are concerned about budget constraints, leasing may be a viable option for you. 

While buying a tow truck requires paying the full cost upfront, leasing allows you to obtain a tow truck at a lower cost and pay for it over time.

In addition, leasing often comes with the option of deferred payments for the first few months, allowing you to get your truck and get your business running smoothly before making any payments. 

Additionally, lease payments may cover taxes, shipping, and the installation of custom equipment, making the process more convenient. However, it's important to note that finance charges may be added to your lease payment and, in some states, the sales tax may be applied to the payment amount. 

Alternatively, you can structure your lease with a $1 buyout option, which would include the sales tax in the payment. Ultimately, the decision to buy or lease a tow truck will depend on your individual financial situation and needs.

 

How to find the best deal on a tow truck lease


If you're looking for a great deal on a tow truck lease….
There are a few things you can do to make sure you get the best possible price. 
Another thing to keep in mind is that many companies like Trust Capital offer discounts for certain types of customers, 


So….

It pays to ask about any specials that might be available. 

Finally…


Be sure to read the fine print carefully before signing any leases so you know exactly what you're getting into. 
By following these tips.

You can save yourself a lot of money on your next tow truck lease.


5 Benefits of Working with Trust Capital USA

  • Speed is Our Specialty. Approval in a few hours, not days.
  • Ability to Finance Used Tow Trucks. If the Tow Truck is the right or fit for your business, we can finance it.
  • Personalized Approach. Our experienced staff understand the Towing and Tow Truck industry. We’ll customize your payments to fit your long-term budget and business needs.
  • Financial Freedom. Our tow truck lease won’t tangle up your personal lines of credit. We don’t put the lease on your personal credit. You'll establish business credit with Paynet and Duns & Brad Street. 
  • No Red Tape. As a direct lender, we know your time is valuable. We’ll handle all paperwork, coordinate payment, and make sure the truck gets on the road quickly.


How to Qualifying for Tow Truck Leasing


Before I explain how to qualify for tow truck leasing.

I would like to talk about there are 4 kinds of tow truck lenders:


Business Credit Lender
Cash Flow Lender
Structured Lender
Collateral Lender

Credit-based tow truck lenders are at the top for 2 reasons: 

1. They have the lowest rates (usually) 

2. They don't ask for a lot of extra information You might have already guessed... 

They examine one thing…

What is the first question most of our customers ask when we mention tow truck leasing?

Will I Qualify for Tow Truck Lease?


If you're looking to lease a tow truck without breaking the bank, there are a few things you'll need to do in order to qualify. 
Here is what tow truck leasing companies (and lenders) look for in a credit-based program:


Good FICO score 
Comp Credit
Credit depth
Credit Experience


First, 
You'll need to have a good FICO score. This is important because it will show lenders that you're a responsible borrower and that you're likely to make your payments on time. Credit lenders like to see FICO scores. If you have a 680+ FICO score then you will be qualified for most credit based programs and if you have 640+ FICO score then you’ll have slightly higher payments but when your FICO score 625+ you'll still get approved but your rate will be even higher and it may help to put some money down. With FICO score 600+ you may still qualify application only but you may need to explain why your score dropped down and pay a higher rate. A very low FICO score like below 600- unlikely to qualify unless you provide three months of bank statements and show good cash flow and make a down payment but FICO score is not one factor to getting approved. If you have a good 700+ FICO score then you’ll be qualified for tow truck leasing with a low interest rate but if you have low FICO score then you’ll be able to qualify but your interest rate will be high.


A big factor besides FICO score that tow truck leasing companies look at that most people don't know about is comp credit (installment debt history) can be having financed a vehicle in the past for yourself... or having financed something for your business. Tow truck lenders like to see that you have financed a vehicle, a personal loan, line of credit, or a home equity line of credit in the past on your personal credit of at least 50% of the loan amount you're requesting now. 
The length of your credit simply tells you how long ago you opened your first "trade line." A trade line is the first time you borrowed money. Trade lines are any accounts on your credit report such as:

Credit cards 
Mortgages 
Installment loans 

Most credit lenders want to see that your credit history goes back 5 or more years, and that you have five or more trade lines on your account. If you have all of these good records then you’ll be qualified application only with out needing to provide more information. 

How Will the Tow Truck Lease Process Work and What to Watch Out for?

In most cases you'll need to provide a credit application that includes your business FEIN, entity structure, address and phone number. Your name, home address and social security number. Once you submit this information you will typically get a quick decision. If approved you can use your approval with any private party, dealer or auction. Once you pick out the tow truck, You'll turn in the buyers order. The leasing company can draw up your lease documents once they receive a copy of the title and the buyers order. Once you sign the lease documents and submit all of the funding stipulations, such as tow truck insurance, reassignment of title and final invoice, the tow truck lender can fund your tow truck. 

Final Thoughts on How to Lease a Tow Truck without Breaking the Bank


Leasing a tow truck can be an expensive endeavor, but it doesn't have to break the bank…
With careful research and comparison of leasing companies, you may find a deal that fits your budget and lifestyle. 
Remember to take into account all costs associated with leasing a tow truck before taking the plunge. 
By following our tips, 
You'll soon be on your way to finding the perfect tow truck for your business without breaking the bank! Contact Trust Capital today at 866-458-4777 to get pre approved for a tow truck so you can go shopping.

 

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