The food truck business is a rising trend and will be prevalent for decades to come. However, you might face challenges getting into the business if you lack the funds to finance a food truck
High-end food trucks typically start at around $80,000 for the vehicle alone. Once you add up equipment costs, marketing investments, and inventory expenses, that number can climb even higher. If you’re already feeling the sticker shock, you’ll be glad to know that many different financing options are available – even if you have bad or no credit.
Finance Food Truck With a Bad Credit
Several lenders evaluate your application holistically, considering your business strategy, annual income, and past repayment history, even if your credit score is frequently the critical determinant in determining if you qualify for a loan.
Considering alternative financing options, such as equipment funding, which enables you to use your purchase as collateral, or using a line of credit, which allows you to increase the number of funds you have access to, can help you purchase a food truck if you’re short on cash.
Here are four tips you can use to get financing with bad credit.
1. Build a Payment Down
The ideal solution would be to reduce your monthly installments to the lowest. Choose a lender that provides loans with low or even no interest to achieve this. Look into lenders offering lower interest rates if you are not eligible for a 0% interest rate loan.
2. Consider Improving Your Credit Score
Increasing your credit score is the first step to acquiring financing for your food truck. Clearing off old debts, ensuring you have enough on hand to fund the loans, down payments and closing charges, and maintaining an active credit history are all ways you can improve your credit. The easier it is to approve a loan, the higher your credit score.
3. Settle Other Debts Before Borrowing
Settle any debts you may have first before borrowing. Typically, lenders want proof that you’ve paid all of your payments on time.
4. Check the Loan You Qualify
Find lenders who can lend you money for a food truck with lousy credit once you’ve decided what kind of loan you want. There are many loans available, including mortgages with fixed and adjustable rates. Depending on your income level, some lenders might only lend you a particular amount, while others offer more if you need it.
Finance Your Food Truck Right Away!
Getting a finance food truck with adverse credit may seem challenging, but it doesn’t have to be. Following these tips will give you a better chance of getting a loan approved so you can get your food truck business off the ground as soon as possible.
We provide food truck financing to our clients who need it at Legion Food Trucks. Take advantage of our partners’ financing options to give your food truck a solid foundation. Contact us today for more information and to get a customized food truck.