As a tow truck company owner, you will, at one point or another, need to obtain new tow trucks and may need to use tow truck financing in order to do so, just like Renton Towing. Once you begin to consider tow truck financing, you may realize that there are many different options from which you can choose in the tow truck financing market. So how do you know where to start? How do you know what option will work best for your company and your budget? It can be a little overwhelming to try and figure all of this out on your own. That’s why it is encouraged that you contact a commercial truck financing company that specializes in tow truck financing.
The start of your search can begin with something as simple as a Google search for “tow truck financing” or “commercial truck financing.” From there, your search can really begin. Investigate the first several tow truck financing companies that come up, and look at their websites. Look each company up on the Better Business Bureau and see if there are any complaints or negative comments about these companies. Keep in mind that one or two negative responses may not necessarily mean that the company is bad because even extremely good tow truck financing companies can receive a bad review from a client. Also, check social media sites, such as Facebook or Twitter, to find more information on potential tow truck financing companies with which you are considering working. See how the tow truck financing companies are communicating with the public, and see if any positive or negative remarks are made about the tow truck financing companies.
It is also recommended that you ask other tow truck company owners about their experiences with the tow truck financing companies they have used. Get referrals from your peers. Once you have narrowed down exactly who you would like to handle your tow truck financing, then you will need to decide what kind of tow truck financing option is going to work best for you. In most cases, you will need to choose between a commercial truck loan or a commercial truck lease.
The distinguishable difference between these two options is the way that they are reflected on your balance sheet. A commercial truck loan will show as a debt for the entire financed amount. This will affect your debt to income ratio, which is a primary determining factor when applying for any kind of financing. The other option that you will be presented with is a commercial truck lease. A commercial truck lease will reflect on your balance statement as a debt, but only for the amount of your monthly payment, as opposed to your entire financed amount. A commercial truck lease will have less effect on your balance sheet and debt to income ratio than a commercial truck loan. Keep this in mind when applying for your tow truck financing.Once you have worked out the exact financing terms for your new or used tow truck, you will need to provide various documents to the lender such as license, bank statements, tax returns, down payment, and credit report. Then you will be on your way to business as usual.