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Equipment Leasing Transportation

The Cost of Purchasing A Semi Truck

What is the cost of Purchasing A Semi Truck in 2022?

When it comes time to purchase your next commercial vehicle, there are many factors to consider. One key question you might have is about the cost of purchasing a semi-truck. After all, commercial vehicles aren’t cheap. 

Depending on the make and model of your new truck, the cost of purchasing a semi will vary widely. Fortunately, with a little research, you can get a good idea of what to expect from your next purchase. 

The good news is that we have already done that research for you, and in this article, we will go over everything you need to know in order to purchase your next new or used semi-truck. 

In this guide, you will learn how much a semi-truck costs, the additional expenses involved with buying a semi, whether you should buy new or used, how much most semi-truck drivers earn, and much more. 

How Much Does it Cost to Purchase a Semi Truck?

This is a tough question to answer, as it depends on a few factors. One factor is the make and model of your semi-truck. Next, it depends on the condition of the truck you choose. Some manufacturers list their models as “drivable,” while others state they are “as is” or “where is.” 

That said, some good general guidelines can be helpful when purchasing a new semi. As a very basic rule-of-thumb, a high-end semi-truck, such as a Peterbilt or a Kenworth, should cost around $200,000+ if purchased new or around $175,000 used. A mid-range model such as a Freightliner, International, or Volvo truck will be cheaper and can often be found for around $150,000 new or $100,000 used. 

However, you also need to consider the other expenses involved with buying a semi-truck. This includes such things as the purchase price of the truck, taxes, and the cost of using it. If you buy a used truck, you should also factor in the cost of repairs.

Other Costs When Purchasing a Semi Truck

When you purchase a new vehicle, you won’t have too many expenses. However, there are some unavoidable expenses associated with owning any semi-truck. 

First and foremost, you will need to make sure you have enough fuel to run the truck. Some trucks require a lot of fuel to operate, while others only require a few gallons at a time. It’s a good idea to have a set amount of money for fuel while you’re on the road.

Of course, you will also need to have a license to operate the vehicle. Training and licensing vary in price, but generally speaking, if you don’t already have a license, you should budget around $10,000 for training and licensing. Make sure you also clear your calendar for the training and testing. 

Next, you will need to insure the vehicle. Insurance for commercial highway trucks isn’t cheap. You’ll need to shop around and get a few different quotes before making your decision on an insurance policy for your semi. For an average truck driver with an average truck, you’re looking at between $2000 – $18,000 per year for insurance. 

Finally, don’t forget about the taxes. When you purchase a truck, whether it’s new or used, you will need to pay tax. It’s important to keep in mind that the tax rate is not based on the purchase price but rather on the truck’s book value. So, remember to inquire about the taxes before finalizing your purchase. 

Should You Purchase a New or Used Semi Truck?

The short answer to this question is that it really all depends on your budget. Used trucks will almost always be cheaper to buy upfront. However, new trucks are usually less expensive in the long run because they require fewer repairs and are typically covered under warranty. 

Regardless of whether you decide to buy new or used, there are a few things to consider before making your purchase. 

First, you should make sure the model you choose fits your company’s needs. This might mean that your next purchase is a bigger model. Or it might mean that you choose a different model. 

Next, you need to make sure that your chosen truck is profitable. Remember, some models are more profitable than others. You should always do a lot of research on your truck’s profitability before you make a purchase.

To help you with that task, we have compiled a list of pros and cons associated with purchasing both new and used semi-trucks so that you can decide which option will be best for you, your business, and your budget.

The Pros and Cons of Buying New vs Used

Keep in mind that there may be additional benefits and drawbacks of buying both new and used semi trucks. However, this list details the biggest advantages and disadvantages of each option. 

The Pros of Buying a New Semi Truck

  • New trucks have the latest technology
  • There is a large selection of new trucks to choose from
  • New trucks come with a large warranty
  • New trucks are often cheaper to operate than used trucks
  • New trucks are more profitable than used trucks

The Cons of Buying a New Semi Truck

  • New trucks cost more upfront
  • The taxes will be higher with a new truck
  • New trucks are more expensive to insure

The Pros of Buying a Used Semi Truck

  • Used trucks are cheaper upfront
  • Used trucks can be a good investment
  • Used trucks have lower taxes

The Cons of Buying a Used Semi Truck

  • Used trucks may need expensive repairs
  • Used trucks are less fuel efficient
  • Used trucks cost more to operate

As you can see, the best option is usually to buy a new semi truck rather than a used one. But, if you do your homework, shop around, and get lucky, you may be able to find a profitable used truck that doesn’t require many repairs for a good price.

Consider Leasing or Financing Your Semi Truck 

One thing to remember about purchasing a semi-truck is that it will cost a lot of money. However, you can often lease the truck or finance the purchase. These options allow you to get a new or used semi truck without paying the full amount upfront. 

Of course, if you have the money to purchase your new truck outright, then that is probably the best option. But new trucks are expensive, and most people don’t have a few hundred thousand in cash on-hand to purchase a semi. 

Leasing and financing are great alternative options that can help you get the truck you need today and spread the cost out over the course of several years.

The Benefits of Semi Truck Leasing

For those who don’t want to take on the financial risk of financing a truck, leasing a semi-truck can be a good alternative. With a lease, you have the security of knowing your costs of purchasing a semi truck. At the same time, you don’t own the truck and don’t have to worry about driving it off the lot. Should the need arise to buy a truck, you can simply end the lease and walk away. 

There are also a number of other benefits to leasing a semi-truck. First, the lease payments usually include maintenance and fuel. This means you’re getting a truck with fewer out-of-pocket expenses. In addition, since you’re leasing the truck and not buying it outright, you don’t have to pay any taxes on the purchase price. This can help you save thousands of dollars over the lifetime of the truck.

The Benefits of Semi Truck Financing

The downside of leasing a truck is that you don’t own the asset. If you choose to finance your truck, you do own the truck, but you pay for the purchase over time. Typically, you will pay a small percentage of the value of the truck each month until it’s paid off, at which point you are free to sell the truck or do whatever you want with it.  There are a number of advantages to financing a truck over owning it. First, you don’t have to worry about maintenance and fuel expenses. This can help save you money in the long run. Plus, financing a truck can help you save a considerable amount of money on taxes. Most truck drivers choose to finance their semi-trucks, but leasing can sometimes be a great option.

The Benefits of Semi Truck Financing and the cost of purchasing.

Being a Truck Driver is a Good Career

Truck driving is a good career if you are looking for a job that pays well and is flexible. Truck driving can be rewarding in terms of both money and experience. A lot of drivers are self-employed, so they can work when they want to. 

While there are some disadvantages to being a truck driver, such as long hours and difficult weather conditions, it’s worth considering if you want to earn a consistent income while being your own boss and travelling across the country or continent.

How Much Can Truck Drivers Earn?

The salary of a semi-truck driver will vary depending on the type of trucking you choose to do, your experience, and the company you work for. Depending on these factors, the salary for a semi-truck driver can be upwards of $100,000 dollars per year, or even more for owner-operators. 

Of course, this is assuming a long work week. It’s also important to note that you won’t see these wages right away. New truck drivers will start off with a lower salary while they are still in training, and it could take several years before they have the experience required to earn the highest rates in the industry. 

That said, it’s not unreasonable to expect that you will be making a six-figure income after only a few years, as long as you are willing to put in the work and the long hours behind the wheel. 

Common Expenses of Truck Drivers

Keep in mind that there are some expenses associated with truck driving, such as insurance and maintenance. You’ll also have to factor in the cost of fuel, as well as new tires and any repairs that may be needed from time to time.  

In addition to these expenses, you’ll also be responsible for your vehicle payments. Depending on the type of truck you choose to drive, this can amount to thousands of dollars every month. However, the vast majority of truck drivers are able to pay for these expenses and still make a good amount of profit. 

Conclusion

Truck driving is a good career that allows people to work flexible hours and earn a great amount of money. However, in order to get started, you will need a truck. Semi-trucks are expensive. So, what are the cost of purchasing a semi truck? Depending on the age, make, and model, you could be looking at $200,000 or more for a new semi. This is why it makes sense to either finance or lease your truck. 

If you decide that you want to finance a semi-truck, then Equipment Finance Canada can help. Equipment Finance Canada works with people who need to acquire industrial equipment, such as semi trucks, and offers great financing options with low-interest rates. So, if you want to get into a brand new or gently used semi today, then be sure to contact Equipment Finance Canada

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Equipment Leasing

How To Get Approved For Equipment Leasing

Purchasing equipment can be very expensive, and you may not always need to own the equipment required for a project. By leasing equipment, you can save money and still have everything you need to complete the job. That said, leasing is a form of credit and, as such, requires approval. In this guide, we will explain how to get approved for equipment leasing. And offer some tips that can make the application process easy and straightforward. 

Keep reading to learn:

  • What equipment leasing is
  • The documents required to lease equipment
  • How to increase the odds of being approved
  • Where you can lease equipment
  • And much more

What is Equipment Leasing?

Equipment leasing is similar to financing equipment. The main difference between equipment leasing and financing, is that when leasing, it’s actually the lender who purchases the equipment. In other words, when you lease, you will own the equipment outright once the term of the lease has expired. Because the client is actually not purchasing the equipment, leasing is generally easier to get approved for than typical financing. Equipment leasing rates are still very competitive. Especially for those who are well qualified, making leasing an attractive option for those who only need the equipment for a limited time.  

How to Get Approved for Equipment Leasing?

Because leasing is a form of credit, you’ll be subject to credit and background checks. This is because equipment is often very expensive, and the lender needs to be sure that you have the means to cover the cost of the equipment if it’s lost, stolen, or damaged. Not every business gets approved for leasing, but there are a few things you can do to give yourself the best chance of being approved. So, let’s go over what you can do to increase your likelihood of being approved for equipment leasing. 

Ensure your credit is in good standing 

First and foremost, your business will need to have a good credit score in order to be approved for equipment leasing. You won’t necessarily need perfect credit, but your credit should be good and be in good standing. If your credit isn’t good, then there are a few things you can do to improve your credit score. 

How to improve your credit score to get approved for Equipment Leasing

The best way to improve your credit score rapidly is to pay off any outstanding debts you’ve incurred. If it isn’t possible to pay those debts off entirely, then ensure you make payment arrangements and stick to the agreed-upon schedule. You can consider consolidating your debts into a single payment which might make repayment easier. Also, try not to use all of your credit. A good general principle is to keep your debt utilization at or below 30% of your available credit, meaning that if you have $100,000 in credit, you shouldn’t use more than $30,000. 

Have an accountant prepare your documents

When you apply for equipment leasing, you will need to submit financial statements showing that you have the means to pay for the equipment if it’s lost, stolen, or damaged. By having an accountant prepare those documents on your behalf, you can ensure that they are accurate and lend more credibility to your application. 

Audited financials can help you get approved for Equipment Leasing

Likewise, by having your financial statements professionally audited, you can greatly increase your odds of being approved for equipment leasing. Generally speaking, anytime you can have a third-party objectively audit your finances, it will be to your benefit in the eyes of the lender. This is especially true if the audit was done by an established accountant or firm. So be sure to hold on to any of your company’s previous tax returns as these can be a great asset when applying for credit facilities, such as leasing or financing. 

Providing the correct information and details about your business 

Another important and often overlooked aspect of a leasing application is your business information. So, when applying for equipment leasing, always ensure that you provide accurate and up-to-date information, as this will be required in order to verify your company’s assets and finances. 

Create a business plan with projections if the business is new

Many people assume that if their company is new, then they won’t be approved financing. This is not always the case. By preparing a detailed business plan that includes future projections, you can significantly increase your odds of being approved for equipment leasing.  

Show how the new equipment will be beneficial to your business 

By explaining how the equipment you intend to lease will help your business generate new or more revenue, you will be able to increase your odds of being approved for that particular equipment. 

Provide Corporate or Personal Guarantees 

Providing some sort of personal or corporate guarantee in writing can also work to your advantage when applying for equipment leasing. This is because the lender will have something in writing should you default on the agreement. Having another company vouch for you can also be an asset on your application. 

Showcase your experience 

It also helps to demonstrate your expertise in your particular industry. By preparing a list of your clients and showing the lender that you have regular customers, you can again improve your odds of being approved for equipment leasing. 

Equipment Financing & Equipment Leasing Approval

Where to lease equipment in Canada?

There are many different companies that provide equipment leasing services to businesses in Canada. However, most of those lenders require all of the documents mentioned above, and possibly even more. Equipment Finance Canada is one of the most trusted sources for equipment leasing. EFC specializes in helping businesses get approved for new equipment when other lenders say no. 

So, if you need to lease some new equipment for an upcoming project, or to help your business get off the ground, then be sure to get in touch with Equipment Finance Canada today. The experts at EFC will be able to help you through every step of the application process. They offer competitive rates to help your company grow and succeed. 

Categories
Equipment Leasing

Leasing Equipment From a Private Sale

Purchasing equipment is expensive, and as such, it pays to shop around. Oftentimes, the best way to secure a great deal is leasing equipment from a private sale, either second-hand or through an independent seller, as opposed to buying new or directly through a vendor. But banks typically don’t finance private sales. Fortunately, there is a solution that allows customers to secure financing for equipment purchases through private sales, and that’s what we’ll be looking at in this article. 

Keep reading to learn: 

  • What a private sale is
  • The pros and cons of private sales
  • The precautions to take when buying privately
  • How to lease equipment from a private sale
  • And much more

What is a Private Sale?

In simple terms, a private sale is when you purchase something from another person rather than from a company. Buying used equipment or finding equipment for sale through classified sites like AutoTrader and Craigslist are great examples.

The Differences Between Leasing Equipment From a Private Sale and Leasing from a Vendor

There are some key differences between buying privately and buying from a vendor. For starters, when you buy privately, you’ll almost always get a much better deal. However, when you buy equipment in a private sale, it may not be in perfect condition, and it can sometimes be difficult to secure financing for private sales. That said, it’s very possible to find like-new equipment for a fraction of the normal price when purchasing via a private sale, and there are financing options available if you know where to look. 

The pros and cons of leasing equipment from a private sale

There are definitely some pros and cons to consider when deciding whether you want to buy privately or through a vendor, let’s look at them now. 

Pros 

Prices are often negotiable

When you purchase something through a private sale, you can usually negotiate the price, whereas when you buy from a store, retailer, or other vendors, the prices are usually firm. 

You can find a better deal

In almost all cases, you’ll be able to save a ton of money when purchasing your equipment privately rather than through a vendor. Sometimes you can even source equipment for half the price that it would cost when buying from a traditional outlet. 

Equipment is often like new

Many people think that buying privately means getting subpar equipment, but in many instances, this is simply not the case. Very often, private sellers are looking to off-load gently used equipment that is almost brand new and is in perfect working condition. 

There is no tax to pay

When you buy equipment through a private sale, you won’t need to pay sales tax, which in some cases can amount to thousands of dollars saved. 

Cons

Equipment may be damaged

It’s true that sometimes, disreputable sellers may list damaged equipment for sale in hopes of recuperating their money on the equipment. As such, it’s important to protect yourself when purchasing privately, and there are a number of ways to do that, which we will look at momentarily. 

A warranty may not be included

More often than not, when you purchase equipment privately, it will not include the original warranty, which means that repairs will generally need to be covered out-of-pocket. However, sometimes a portion of the original warranty will still be in place and can be transferred over to you as the new owner. 

The precautions to take when purchasing from a private sale 

As mentioned, some private sellers list damaged equipment for sale, so when buying privately, it’s always wise to exercise due diligence and do your homework before going through with the purchase. Let’s go over a few of the ways that you can protect yourself when purchasing equipment from a private sale. 

Overall condition of the equipment

You should always inspect the overall condition of the equipment before you buy it. Simply put, you should never take a private seller’s word that their equipment is in perfect working condition; the only way to ensure this is by testing and inspecting the equipment yourself. 

Inspection reports

Always ask to see any available inspection reports for the equipment you’re considering before handing over your money. If no inspection reports are available, then that’s a red flag that could indicate something isn’t quite right with the sale. 

KMs and Hours 

Be sure that you consider the mileage or hours before making a purchase. Vehicles and other pieces of equipment that have high mileage are much more likely to require costly repairs in the immediate future. 

Private sales can be leased by Equipment Finance Canada 

If you find a great piece of equipment and would like to purchase it through a private sale but don’t want to invest all of the money upfront, then you’re in luck. Equipment Finance Canada can help you finance equipment purchases from private sales, and there are a number of excellent advantages you’ll enjoy when financing through EFC.  

Why lease through Equipment Finance Canada 

Equipment Finance Canada helps businesses and individuals with leasing equipment from a private sale. Let’s go over some of the best reasons to finance your equipment through Equipment Finance Canada when buying from a private seller. 

Local banks do not specialize in private sales 

In most cases, your local bank or credit union will not help with financing a private sale. The same goes for equipment leasing and equipment financing. Simply put, it’s almost never possible to finance used trucks / used equipment through a traditional lender. That’s where Equipment Finance Canada is different. We help people finance the equipment they want regardless of who’s selling it. 

We have a wide variety of lenders who are willing to fund private sales

At Equipment Finance Canada, we take pride in having some of the best lenders anywhere. We have a large network of lenders who are willing to fund private sales, and almost always at very competitive rates. 

We can pre-approve buyers 

When you want to finance equipment, it helps to know what your budget is. At Equipment Finance Canada, we pre-approve buyers so that they can search for equipment that they know they’ll qualify for. 

We are able to pay sellers directly

Unlike most traditional lenders, we pay sellers directly so that you never have to worry about handling a large cash transaction yourself. Simply file your application, get pre-approved and let us know what you’d like to buy and from whom; we’ll take care of the rest. 

We ensure equipment is free and clear

To further assist you when buying equipment from a private sale, we personally ensure that the equipment is free and clear, that there are no liens on the equipment, and that everything is above-board, which can save you a ton of problems down the road. 

Summary

Purchasing equipment from a private sale is a great way to get the equipment you need for a fraction of the price you’d pay to a vendor. That said, it’s important to do your homework when buying privately, but as long as you inspect the equipment yourself, this can be a great cost-effective means to acquire the equipment you want without breaking the bank. Traditional lenders often don’t finance private sales, but Equipment Finance Canada can help. So, if you want a equipment lease from a private sale, then be sure to contact EFC today to learn more or submit an application.