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Crane Truck Equipment Financing: What You Need to Know
Purchasing heavy equipment like crane trucks is a major investment for any construction business. With costs quickly rising, many companies are turning to financing as an affordable way to acquire the machinery they need to take on new projects and grow their operations.As a leading financial services company, Delancey Street understands the unique equipment financing needs of the construction industry. We’ve helped countless contractors, subcontractors, and other specialists get the necessary funding to purchase all types of cranes and crane trucks.In this comprehensive guide, we’ll cover everything you need to know about financing crane trucks, from the benefits and loan types to interest rates and qualifications. Read on to learn how you can get flexible financing that aligns with the needs of your business.
Overview of Crane Truck Equipment Financing
Also known as a boom truck, a crane truck is a versatile vehicle fitted with a pivoting crane used to lift, lower, and transport loads. These powerful machines, which range from small pickup-mounted cranes to giant 18-wheeler cranes, are a must for construction companies needing to haul and maneuver heavy materials and equipment.Purchasing a new or used crane truck requires a significant upfront investment, with costs ranging from $50,000 for a used pickup crane to over $200,000 for a new 18-wheeler crane. Financing brings major benefits that allow you to acquire the equipment you need without draining your cash reserves:
- Preserve capital – Rather than paying the full amount upfront, financing only requires a down payment so you can conserve working capital for other business needs.
- Flexible terms – Loans and leases allow you to pay off the equipment over 12 months or longer. This aligns payments with your project timelines.
- Predictable payments – Fixed monthly payments help you reliably budget for the expense.
- Tax benefits – Leasing may provide tax deductions to reduce your liability.
Types of Financing for Crane Trucks
Construction companies have two main options when financing a crane truck purchase: equipment loans or equipment leasing. Here’s an overview of how each works:
With an equipment loan, you borrow money from a lender to purchase the crane truck. The crane truck acts as collateral for the loan. You make fixed monthly payments consisting of principal and interest charges over the loan term, typically 24 to 72 months. Once it’s paid off, you own the equipment free and clear.Equipment loans allow you to conserve cash flow while spreading out the cost over time. Interest rates are usually fixed so your monthly payments remain consistent.
Leasing is another popular option for financing crane trucks and other heavy machinery. Under a lease, you make fixed monthly payments to essentially “rent” the equipment for a predetermined period, usually 12 to 60 months. You don’t own the crane truck during the lease.At the end of the lease, you can purchase the equipment at its fair market value, renew the lease, or return it to the lessor. Leasing provides more flexibility since you aren’t locked into owning the crane long-term. It also allows you to upgrade to newer models more frequently.
What Impacts Your Crane Truck Financing Rate?
While financing makes crane trucks more affordable, it’s important to get the best rates possible to minimize interest expenses. The factors that influence your rate include:
- Credit score – Borrowers with higher scores usually qualify for lower rates.
- Down payment – A larger down payment reduces the amount you need to finance.
- Equipment value – Newer cranes hold value better, qualifying for lower rates.
- Loan term – Shorter terms often have lower rates.
- Business performance – Profitability and revenue affect qualification.
Strong credit, healthy business finances, and a substantial down payment show lenders you’re a low-risk borrower qualified for the most competitive rates. Be ready to provide financial statements and documentation when applying.
Crane Truck Financing Interest Rates
Current interest rates on crane truck loans and leases often range from 4% to 8% for borrowers with good credit. Rates depend on the factors above as well as overall economic conditions. With the Federal Reserve consistently raising interest rates in 2022, financing rates have trended upward but remain near historic lows.Leasing often provides lower effective rates than loans when you account for the residual value. For example, you may pay a 5% rate on a 5-year lease. But up to 30% of payments go toward the residual value, reducing the true interest cost.Make sure to compare rates from multiple lenders to find the best financing option for your business. Working with a broker like Delancey Street also helps you compare many lenders to discover the most competitive rates and terms.
How Much Can You Borrow for a Crane Truck?
Lenders offer financing for a wide range of crane truck equipment costs. At Delancey Street, our equipment financing programs can fund any amount from $5,000 up to $5 million. We work with national, regional, and local banks and other institutions to get you approved for the financing you need.The amount you qualify for depends on the value of the crane truck, your finances, credit, and down payment amount. Lenders typically finance 80% to 100% of the equipment cost. For a $100,000 crane truck, you may need to put 10% to 20% down.Having strong business finances and personal credit scores makes qualification easier. But startups and those with credit challenges can still get approved through alternative lenders.
What Do You Need to Qualify for Financing?
Getting approved for crane truck financing simply requires submitting a few documents to establish your creditworthiness:
- Business financial statements and tax returns
- Personal financial statements and tax returns
- Business and personal credit reports
- Equipment purchase quote or invoice
- Business formation documents
We’ll help you put together the necessary paperwork to present to lenders during the application process. Even new businesses and those with past credit troubles can qualify with the right lender.
How Long Does the Financing Process Take?
Our streamlined process makes financing equipment fast and simple. Here are the general steps we take after you submit your application:
- 1-2 days: We assess your needs and match you with appropriate lender partners.
- 3-5 days: You provide necessary documents for underwriting.
- 2-3 days: The lender underwrites and approves your application.
- 1-3 days: Financing documents are prepared and signed.
- 1-2 days: Funds are issued once you take delivery of the equipment.
In as little as 1-2 weeks, you can have financing secured so you can purchase the crane truck and get to work. The easy process causes minimal disruption to your day-to-day operations.
Use Financing to Invest in Your Business
As a trusted financing advisor for the construction industry, Delancey Street is here to help you get affordable funding to purchase the crane trucks and other equipment your business needs. Our simple process saves you time so you can focus on your projects.With customized financing, you can conserve capital, smooth out equipment costs over time, and propel your business growth. Reach out today to learn more about our competitive financing programs for crane trucks and all your heavy machinery needs.