Tool truck financing for outfitted van or panel trucks that are designed to showcase parts and tools for customers, or serve as a business owned and used parts and tool truck is available through equipment loan, leasing, and other equipment financing solutions.
These units can be purchased through a dealer or private seller, although the process of acquisition through a private seller will have a few extra steps such as inspection and lien search.
Vehicles both new and used can be financed with used assets over 10 years still able to get financing in many cases, depending on the condition of the asset and the amount of useful life remaining as compared to the loan or lease term being sought.
For new tool trucks, you can look basically secure 100% financing with the only cash outlay typically being your first payment in advance.
If capital is provided via an equipment loan, you will own the tool truck from the outset of acquisition. If the asset is being leased, then there are some other considerations you will have to make.
For instance, if you intend to own the truck at the end of the lease term, then you would enter into a capital lease where at the end of the lease you would be required to pay a small buyout amount, typically no more than $20, in order to have the vehicle transferred over to you.
If you want the option to return a tool truck at the end of the lease term, then you would be looking at an operating lease where at the end of the financing term you can turn the truck over to the leasing company with no further obligations to pay against it.
Most operating leases also provide buyout options in the event that you decide later to purchase the asset.
One of the best features of an operating lease is that at least 10% of the principle is not repaid during the lease term which allows the payments to be smaller as compared to a loan or capital lease for a similar amount.
There can also be tax advantages to an operating lease which should be discussed with your accountant before hand.
With used tool trucks, depending on the age of the asset and the amount of time in business, you can expect to pay anywhere from 10% to 25% down from your own cash reserves.
This can even be possible with start up businesses provided that you have the credit rating and personal net worth to support your new business.
Financing for start ups related to tool and part franchises are going is going to be easier to obtain than an independent start up due to the fact that an existing and established franchise model will provide more predictable results in most cases as well as support to the business owner as they work to get established.
The key for start up financing is going to be proof of down payment and working capital to start the business as well as a business plan and financial projections to not only show a plan of action to get started, but that the relevant costs of the business are being identified and that there is sufficient cash flow to cover all costs including debt servicing for a tool truck credit facility.
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