When you want to grow your trucking business, you want to be sure you’re using the right kind of funding. Major banks and lenders often have stringent lending requirements in place, requirements that many business owners don’t meet. You might believe your options are limited if you don’t meet these traditional income or credit history requirements due to your company’s age or other reasons, but that’s not necessarily the case.
By leveraging the equity that exists in the assets you already own, you can unlock the money you need to grow your trucking business. As long as you already have valuable equipment or collateral, asset based loans are often easier to qualify for than other kinds of business loans. Read on to find out exactly how asset based truck loans can work for you.
Get Quick Access to Capital
If you’ve gone through applying for a loan through a major bank, you know that the process isn’t a quick one. It’s often an in-depth and intrusive review of your previous financial history rather than being based on where you and your business stand today. Most business owners don’t have a plethora of free time to fill out all the paperwork required.
Because asset based funding involves the equity in the equipment you already own and not digging through your past credit history, income or ratios, it doesn’t require the same amount of time. You can get access to the money you need to help your business survive and thrive immediately.
Reduce your Payments
If you have existing loans and are currently locked into higher interest rates than you want to be paying, you can refinance them to get a lower interest rate and reduce your monthly payments. An asset based lending company can help you pay off your existing loan or line of credit and open up a new one using your trucking fleet as collateral, which will help you tap into lower interest rates.
With a lower interest rate, your loan will accrue less interest over the timespan you have it. This will reduce your monthly payments, which will help open up more cash flow for your business, which you can use in various ways to grow or maintain your business, from purchasing new equipment to making repairs to existing equipment you already own.
If you’re managing previous debts, asset based refinancing can be a great option to consolidate your debts. This helps to lower your interest rates, generate operating capital, and provide tax relief.
Going through major banks and lenders can create a lot of unnecessary red tape that you just don’t have the time to cut through as a business owner. Using refinancing and asset based lending options to free up funding to grow your business can be the smarter, quicker and easier option you and your business are looking for.