In need of additional working capital to purchase a dump truck?
Businesses involving dump trucks should always get the right truck for operations to run smoothly. Thus, taking the time to select the right truck is essential.
After you have selected the truck the next step is to look for the dump truck financing company that can be of aid to your dump truck leasing needs.
In this article, we will discuss dump truck financing and how it is helpful for startup businesses. We will also talk about how it can help those with insufficient funds that need dump truck loans to purchase dump truck leases right off the bat.
Expand Your Operations with Dump Truck Financing
Business financing can ease up your worries while you start to expand your business.
Dump truck financing helps businesses start operations immediately without worrying about insufficient working capital.
The first step to achieving successful operations is thinking about what your nature of business is, and how your dump truck will determine your financial stability.
But before we go on discussing buying a dump truck and dump truck financing, let's first talk about the different types of new and used dump trucks.
Knowing what type of dump truck and how you will use this truck will help you craft an effective plan to repay your dump truck lease.
Types of Dump Trucks
There are a lot of dump truck variations out in the market. Each truck is built and designed to serve a different purpose.
Dump trucks differs in size, load limit, and mobility.
Knowing which one is appropriate for your small business is the first step to bringing efficiency to your operations.
The following are the more common types of dump trucks:
Standard Dump Trucks
Standard dump trucks are those with the back carriage mounted into its chassis. A hydraulic ram moves the back carriage, and its tailgate is configured to swing up using top hinges.
In the United States, the typical standard dump trucks have only one steering axle, whereas in Europe these usually have two steering axles.
Off-road Dump Trucks
Off-road dump trucks, sometimes called articulated trucks, are often used in mining operations. It is designed for hauling materials to off-road locations.
As its main purpose is to carry and transfer heavy load, trucks of this type usually will have a load limit of 40 to 60 tons.
Transfer Dump Trucks
Transfer dump trucks are those whose design maximizes the load capacity without compromising its maneuverability.
These are the common dump trucks seen in the western part of United States, as they can be configured to meet the weight restrictions in that area.
Side Dump Trailers
The design of side dump trucks makes unloading faster, dropping the load sideways instead of vertically lifting the cage. This minimizes the instances of tripping over and other accidents that may occur.
However, its load capacity tends to be smaller than standard dump trucks.
Despite being able to decrease operational risks, its characteristics made it one of the least favored options by many contractors.
This dump truck is only used if the construction site has plenty of space and room.
Other Dump Truck Configurations
There are still many other truck types that are rarely used due to their configurations. The best examples are:
- Super dump truck, and
- Semi-trailer end dump truck.
Even if these trucks differ in size, load capacity, and maneuverability, price ranges are still relatively close to each other.
Dump trucks are expensive and using your working capital to acquire can result in an instability with your budget.
To avoid the risk of putting the future of your operations in jeopardy, you need to consider using dump truck financing.
Why Consider Applying for Dump Truck Financing?
First off, getting a single dump truck already requires a huge cash out.
Brand new trucks usually cost around $100,000 - $150,000. Used dump truck financing, on the other hand, are cheaper, ranging from $20,000 - $100,000.
Here’s an example of pricing for dump truck financing: Let’s assume that you want to buy a new $150, 000 dump truck to be financed for 5 years.
If your business’ has been running for 2 years with good credit, then the chances of you paying $3,040 per month for 5 years is higher for a dump truck loan . A decent or imperfect credit can result in a payment of $3,333 per month for 5 years.
If your business is less than 2 years old and has good credit, then you can expect to pay $3,111 per month for those 5 years.
However, if your business is less than 2 years old and has a risky credit, then you can expect to pay $4,225 per month for those 5 years on a dump truck lease.
Click here for a dump truck finance calculator to calculate how much your dump truck financing payments could be and how much of a dump truck you can afford to buy based on your monthly budget.
Nevertheless, acquiring new or used dump trucks cost a lot of money. If your main course of action is to get a bank loan to purchase a dump truck, then you might need to consider other options.
Banks are generally known for their low approval rates, high credit requirements and 10 - 25% down.
If you are a start-up business or one with minimal credit established, dump truck financing will be your best business finance option. You'd better start looking for dump trucks for lease. A lot of customers these days are peterbilt and kenworth dump trucks.
Dump Truck Financing Option for Startups
Dump Truck financing companies use your credit score to assess your capability to repay the borrowed money. It also plays a big role in determining your monthly payment. A good credit score provides a faster application approval compared to the bad credit.
Your monthly payments get higher the lower your personal credit score gets. Startup dirt hauling businesses need a minimum of a 650 credit score to be considered financially stable. If you have at least a 650 credit score you can put little down, get competitive rates and have lease terms up 60 months. If you're under a 650 expect to put two payments down and up to 20% down. If you're below a 600 credit score expect to put 50% down or have additional collateral.
If you’re a new dump truck business with a good credit score, getting a dump truck financing will be easier. Dump truck financing companies use your credit score to assess your capability to repay the borrowed money. It also plays a big role in determining your monthly payment. Chances for businesses getting dump truck financing is relatively high as long as the owner has a good credit score.
Most dump truck loans are designed to help small and startup companies to quickly and efficiently expand their operations. This is done to ensure the borrower can get a faster return on investment.
Dump truck financing is offered with flexible payment options, so business finance companies with seasonal income can repay the business loan with no issues. Such as only making payments 9 months out of the year.
Used Dump Truck Financing To Get A Lower Monthly Payment
If your dirt hauling business is financially not in a good condition to purchase new dirt hauling trucks, you can use used dump truck financing to purchase used dump trucks.
Used dump trucks are still able to handle workloads just the same as the new ones.
However, be wary of dump trucks that are sold at very low prices, as they may be prone to frequent repairs and maintenance.
Choose those that cost around $30,000 to $40,000. Trucks within this price range usually have undergone previous repairs, but are generally in good condition and this can save your cash flow.
Final Thoughts About Dump Truck Financing
Before proceeding with anything else, the first thing you need to do in order to create a successful business is to assess your business type. You also need to determine the assets you will need. Selecting the dump truck best suitable for your operations will help assure you of work.
Dump truck financing can surely help expand your construction business, providing temporary financial relief as you try to gain operational capital. It is available for anyone who wishes to acquire it, provided that they show proof of capability to repay the business loans—either by themselves or with co-signers.
Dump Truck Financing has great tax benefits on your construction equipment
Structure your dump truck financing programs on an equipment financing agreement or on a $1 buy out lease agreement to get section 179 tax benefits. With the passage and signing into law of H.R.1, aka, The Tax Cuts and Jobs Act, the deduction limit for Section 179 increases to $1,000,000 for 2021 and beyond. The limit on dump truck purchases likewise has increased to $2.5 million.
Always remember to never use your capital in purchasing a dump truck. Doing this will put instability in your monthly budget, putting the future of your operations in jeopardy. Put your cash towards things that appreciate and lease dump trucks that depreciate.