Have A Look At Work Trucks and Construction Equipment
Wednesday, December 3rd, 2008As the economy has weakened and defaults have occurred at all levels, lenders Have put themselves into a very difficult position how to do business. On one hand, the lender has taken back tremendous amounts of repossessions due to default of payments or non-compliance of terms with the lease. The lessee can’t afford to make payments when the revenue base isn’t there and the costs of doing business has sky rocketed. The lessee has either walked away from his obligation to pay the lender or the lender has taken back the acquisition. Either way, everybody is a loser and the future looks no brighter.
The lender must recondition these repossessed items and either re-lease them or auction them off at a discount. This isn’t a good scenario because the lender is losing time and dollars on every repossession. As this problem has leveraged itself, it has put some lenders into financial crisis. At the present time, some lenders have had to reevaluate their financial models and make dramatic changes. Their normal lending requirements have become more stringent and fewer prospects will now qualify for commercial trucks and construction equipment than one year ago.
As the lenders normal credit models have changed, this has caused potential buyers to be cautious and/or nervous of lender’s intentions. Every week, information is in the news pertaining to a bank/lender and for the most part this information is damaging to the lending industry. In some instances, some lenders have transformed itself overnight into a different type of lender.
For the startup business, this has caused them to be almost locked out the trucking and construction industry entirely unless they have a personal credit score of 700 or higher. Additionally, the risk/reward factor that is presented at this level has required the lender to require a 15-20% down payment to consider a startup transaction.
The following are the types of work trucks and construction equipment:
Dump trucks, bucket trucks, day cabs, concrete and cement trucks, boom trucks, water and vacuum trucks, articulated trucks, garbage trucks, tow trucks, excavators, bulldozers, forklifts, concrete equipment, concrete pumps, forestry equipment, backhoes, wheel loader equipments etc.
In conclusion, when shopping for financing on commercial trucks and construction equipment, it is important that you acquire as much information pertaining to your lender. Times have changed and your contract that you signed must be carefully read and understood.
