4 Key Points That Will Help You Secure Truck Financing Even With a Low Credit Rating
If you have been in the trucking business as an employee, then chances are you have a strong desire to start your own trucking business in the future. Several factors may inspire or motivate your passion, and these include self-employment, financial independence, and the burning desire for growth.
You might have years of experience and a strong desire to get into the trucking business, but the million-dollar question on your mind is how to get financing with bad credit. Several issues can land you in bad credit.
Research shows that at least 30% of businesses will fail, and the main reason that influences this is the business owner running out of money. Lack of a proper business plan significantly contributes to financial misfortune. It is therefore advised that if you are planning to start your own trucking business, you should come up with a carefully drafted business plan.
A well put together business plan has the following features and advantages.
A clear plan for growth
One of the essential elements of your business plan is that it should have a clear plan for growth. A good plan for growth can either be short term or long term. This includes expansion plans to newer markets in specific geographical areas within a specified period. It can be either on a quarterly, semi-annual, or annual basis.
A clear plan for growth can help you with how to get financing with bad credit. This document (business plan) gives the financier/creditor the confidence that you will be able to settle your dues within the agreed period.
Your partner or partners
Another important feature of your business plan is that it should contain the names of your partner(s). Good partners will offer you valuable advice and constructive criticism; after all, you will not always be right. Getting partners who are seasoned truckers or successful business people will play a significant role in making sure that your business/partnership will be a smooth sail.
Another advantage of getting the right partner(s) is that they will help you with advice on how to get financing with bad credit. This is possible if your partner(s) have a good credit history and they can guarantee the repayment of the heavy duty truck loans or truck financing.
Your clients or potential clients
Your clients or prospective clients can play a key role in your business growth; this is also one of the ways you can figure out how to get financing with bad credit. Bad credit cannot always translate to misuse of funds at your disposal; sometimes unforeseen and unfortunate events happen, and this ends up giving you a bad credit rating.
As a first time owner operator financing seeker, shedding some light on your potential clients can be an advantage in that some clients have an excellent reputation of settling their dues on time. This will give the financier the confidence to offer you the truck financing you require for your business.
Accountability, responsibility, and commitment
Passion is vital, but it will not automatically translate to your trucking business being an overnight success. “Accountability”, “commitment”, and “responsibility” may seem like just a bunch of motivational words from a self-help book; however, these words and actions can play a significant role in persuading your financier or potential financier to give you financing with bad credit. What do these three words mean?
Accountability/responsibility – You are accountable to the funds offered to you, and you are going to make sure that they are strictly used for the intended purposes.
Commitment- This means that you are willing to pay the funds within the time agreed upon and without failure or delay.
The above four points can play a key role in making sure that you successfully start a truck business, and “starting” means just that; religiously considering these four points will all but guarantee your survival in the industry.