The ability of truck owner-operators to obtain loans depends on their credit standing. With the increasing freight demand, truck operators can expand their operations, but this requires more trucks. Current economic conditions make purchasing new trucks more feasible and convenient because of the availability of financing. However, easy financing terms are available only to those with good credit scores.
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Checking Credit Scores
If you are a truck owner looking to apply for a loan for new trucks or additional money for operations, take a look at your credit report. If there are problems with credit history, make sure to draw up plans to address those issues. If there is something in the report that is inaccurate or questionable, contact the appropriate credit reporting agencies.
Truck operators regularly encounter situations beyond their control that greatly impact their financial situation. Accidents could happen on the road or cargo could get damaged before it is delivered, all of which might have a negative impact on your financial standing and, ultimately, your credit. If you have been in any of these situations, make sure to document it for the credit reporting agency. In addition, if any of your payments have been late due to circumstances beyond your control, such as delayed accounts receivable, submit a written explanation to the credit reporting agency and request that the explanation be added to the credit report.
Importance of Good Credit Standing
In addition to checking your credit report, there are a couple more things you can do to ensure good credit standing if you wish to expand your fleet.
First, establish good commercial credit references from three or more companies you do business with. In the absence of commercial credit references, you can get a reference from other vendors you do regular business with, such as diesel fuel providers and tire dealers. These references can help validate to the lender that you are a good credit risk.
Second, pay off outstanding credit card balances or revolving credit. This will show the lender that you are a responsible borrower who can be trusted with a new truck loan.