The final deal killer is a lack of cash. If the business and its owner do not have much cash on hand, proving the ability to step in and cover payments should revenue slow, the bank will not take the risk of lending. This can present a challenge for a specialty boom truck financing lender as well, but if the crane is purchased at a good price the down payment required might be low.For additional information on any of these programs go here.
Most of the boom truck financing customers I speak with have become a bit fatigued. Hours of preparing financial statements and projections, writing out a business plan, and filling out applications have them worn out. Especially since they can’t find a lender willing to finance their equipment purchase. They’re about to give up, forgoing growth opportunities to spare themselves further frustration and dejection. I’ve found one of the primary reasons for this is that most business owners are not aware that there are options to borrowing from a bank. Or if they are aware, they are reluctant to use a private lender. Following is a basic explanation of how private boom truck financing programs are designed to work through, or around, borrower problems that prevent banks from approving a loan. One of the first killers of loan approvals is poor credit. Banks think borrowers with credit issues are too risky. One solution to this is a specialized collateral lender. A private lender specializing in boom truck financing is concerned with the value of the crane more than borrower credit. They can lend against cranes with good value despite credit issues. The second loan denial reason is lack of collateral. Banks reduce risk by insuring the borrower has assets to liquidate to repay the loan should the borrower default. Specialty boom truck financing lenders can fund a purchase if the crane meets their value requirements and the buyer can contribute some cash to the purchase. The borrowing business does not need additional assets to satisfy collateral requirements of a traditional bank. Banks are also hesitant with newer or start up companies. The lack of history creates a perception of higher risk, as the business has not proven it can last. If the business owner has experience working with crane equipment a specialty lender can help.