Best semi-truck financing in June 2023
Financing is the next best option for small business owners who can't afford to purchase a semi-truck with their own funds. Even if you buy one used, you'll likely spend a minimum of $50,000, which is still quite a bit for a new business to pay out of pocket.
Between a down payment, interest and fees, semi-truck financing can be expensive, but it allows you to pay for the truck in installments, making it a quick way to grow and expand your business.
Check out our top picks below for semi-truck financing and some tips to help you choose the best lender for you.
Compare the best semi-truck financing in June 2023
| LENDER | BEST FOR | MIN. CREDIT SCORE | LOAN AMOUNT | MIN. TIME IN BUSINESS |
|---|---|---|---|---|
| National Funding | Loan and lease options | 650 | Up to $150,000 | 6 months |
| Bank of America | Traditional bank | Not stated | $25,000 and up | 24 months |
| Credibly | Bad credit | 550 | $10,000 to $10 million | 6 months |
| CAG Truck Capital | Industry expertise | 600 | $20,000 to $200,000 | N/A |
| Triton Capital | Low rates | 600 | Up to $250,000 | N/A |
| Balboa Capital | Fair credit | 620 | Up to $500,000 | 6 months |
| Truck lenders USA | Truck financing options | 675 | $15,000 to $250,000 | 24 months |
| Commercial Fleet Financing | Quick application | 640 | Not stated | Not stated |
| TAB Bank | Semi-truck banking and loans | Not stated | $30,000 to $300,000 | Not stated |
A closer look at our top semi-truck financing options
National Funding: Best for loan and lease options
Overview: Since 1999, online lender National Funding has funded over $4.5 billion in loans for more than 75,000 businesses. Its equipment financing loan is an unsecured loan designed to help business owners with the purchase of equipment.
No collateral or down payment is required, and loans can be funded in as little as 24 hours. Business owners can also lease new or used semi trucks with no collateral or down payment. National Funding states it provides the lowest lease payments guaranteed or will pay $1,000 toward a qualifying lease.
National Funding’s interest rates start at 4.99 percent. This seems low, but it is only a simple interest rate, which doesn’t show you the true cost of the loan. Other lenders that show you an annual percentage rate (APR) will likely have a higher rate when comparing, but that is because APR takes into account the interest rate and fees.
Why National Funding is the best for loan and lease options: It provides fast funding with no down payment requirements for loans and leases.
Who National Funding is good for: Small business owners with fair credit, who need to quickly purchase or rent a semi truck that costs less than $150,000 will appreciate National Funding’s flexible options.
Bank of America: Best for traditional bank
Overview: Bank of America’s products and services support nearly 3 million small businesses, and the lender states it’s the largest equipment financing company in the country.
Bank of America offers equipment financing to business owners who have been in operation for at least two years and earn a minimum annual revenue of $250,000. The maximum loan term is five years, and the minimum loan amount is $25,000. Funds are available within 10 business days of the application being approved. It doesn’t offer the fastest funding, but starting rates are relatively low for those who qualify.
The lender does not disclose its minimum credit score, and applications can only be completed in person or over the phone. But that level of inconvenience may be worth it if you get an offer with a low APR.
Why Bank of America is the best for traditional bank: Bank of America offers affordable financing to creditworthy borrowers and provides more loan details on its website than many other traditional banks.
Who Bank of America is good for: Established business owners with good or excellent credit will get the most value out of financing their semi truck with Bank of America.
Credibly: Best for Bad Credit
Overview: Credibly is an online lender that has helped over 30,000 U.S. small businesses with funding. Unlike traditional lenders like banks and credit unions, Credibly's loans are available to business owners with bad credit. The online application expedites the financing process. You can prequalify in 10 minutes, loans can be approved in as little as four hours and same-day funding is available.
Credibly doesn’t disclose term lengths for equipment financing, but most of their other loan products are short-term loans with repayment periods of 18 to 24 months. While it does also offer long-term loans, it’s best to confirm term lengths before applying.
Why Credibly is the best for bad credit: Through its partners, Credibly offers unsecured and secured equipment loans from $10,000 to $10 million to small business owners who may not qualify for traditional business financing. This makes Credibly far more accessible than many other best bad credit business lenders.
Who Credibly is good for: The minimum required credit score and lighter business requirements for a loan make Credibly a good option for business owners who struggle to secure low-interest financing elsewhere.
CAG Truck Capital: Best for semi-truck industry expertise
Overview: Pennsylvania-based lender CAG Truck Capital has been in business for over 40 years. The company specializes in truck financing for both established businesses and new owner-operators to the trucking business. Its commercial truck financing is available to business owners with good, bad or no credit, and business owners can pre-qualify. So if your business does not meet the requirements, you can find out without having your credit score impacted.
CAG also provides a high-mileage truck loan with an engine overhaul option. If you can’t afford to pay for a new engine, CAG will finance it and extend the terms of your loan so you won’t have to deal with an increase in how much you pay each month. You’ll end up paying more down the road, especially if you have a high interest rate. But this could come in handy if you’re driving a used semi-truck and want some peace of mind.
Why CAG Truck Capital is the best for truck expertise: CAG Truck Capital specializes in providing semi-truck financing. It states it has on-staff certified diesel truck technicians who can help with the financing and purchasing of a semi truck.
Who CAG Truck Capital is good for: CAG Truck Capital is willing to work with all types of business owners, including semi-truck drivers with no credit and limited time in business. If you can’t qualify for a low-interest loan from a traditional bank or need expert advice when buying a semi truck, CAG is worth a look.
Triton Capital: Best for low rates
Overview: Triton Capital, founded in 2008, is an online lender that offers business equipment loans. Qualified business owners could qualify for Triton’s low rates, flexible terms and fast funding of one to two days after the loan has been approved, which can take between two and four hours.
Their website states they offer loans of up to $250,000, but according to a Triton Capital spokesperson, loan amounts can go up to $500,000.
Unlike other lenders, Triton Capital allows borrowers to make payments monthly, quarterly, seasonally, annually and semi-annually. You can pre-qualify and apply for a loan without your credit being affected because Triton Capital only does a soft pull. The minimum credit score is 600, but typically, low rates are reserved for those with higher credit.
Triton’s rates range from 5.99 percent to 24.99 percent. This is one of the few semi-truck lenders that gives you rates as a total interest percentage (TIP) instead of simple interest or APR. TIP tells you how much interest you’ll pay over the life of your semi-truck loan but doesn’t show the fees.
Why Triton Capital is the best for low rates: Triton Capital's interest rates start as low as 5.99%. The lowest rates are only available to borrowers with higher credit scores, but even their high end could be a good deal compared to other lenders.
Who Triton Capital is good for: Triton Capital is good for established business owners with good or excellent credit who are able to meet the minimum annual revenue requirement, which is higher than many other semi-truck lenders.
Balboa Capital: Best for fair credit
Overview: Balboa Capital, a division of Ameris Bank, has funded over $7 billion business loans nationwide. The lender has a variety of business loans available, including secured equipment financing for up to $300,000 or $500,000 depending on the collateral.
As a top-rated business lender, Balboa Capital offers a quick online application. The company does not disclose how fast funding happens, but loan approval can take as little as one hour.
Balboa doesn’t disclose its rates on its website.
Why Balboa Capital is the best for fair credit: The minimum credit score, time in business and annual revenue needed for Balboa Capital is fairly accessible compared to other lenders.
Who Balboa Capital is good for: Depending on the rates you’re offered, Balboa Capital could be good for business owners who have fair credit and have been in business for at least one year.
Truck Lenders USA: Best for truck financing options
Overview: Truck Lenders USA, a direct lender, has been around since 1977. Business owners looking for semi-truck financing have their choice between two financing options: application only and commercial.
When opting for application only, which is an easier process, business owners can receive a loan between $15,000 and $75,000 with a term of 24 to 60 months for a commercial truck no more than seven years old.
When opting for commercial financing, business owners can receive a loan between $75,000 and $250,000 with a term of 24 to 60 months for a commercial truck no more than seven years old. Jumbo leases of up to $1,000,000 are also available. Terms are 24 to 60 months, and a down payment and residuals of 10 percent to 15 percent are required.
Why Truck Lenders USA is the best for truck financing options: While some lenders offer one semi-truck financing option, Truck Lenders USA offers business owners their choice between different types of loans for truck financing and leasing, which provides borrowers more flexibility.
Who Truck Lenders USA is good for: Truck Lenders USA is good for semi-truck drivers with established businesses and strong credit who may want to explore loans and leases with one lender.
Commercial Fleet Financing: Best for quick application
Overview: Commercial Fleet Financing has funded over $1.5 billion in transportation equipment loans. Loan amounts are not disclosed, but terms range from 3 to 9 years. Semi-truck drivers looking for a loan usually need a credit score of 640. But Commercial Fleet Financing has a sister company called Fresh Start Equipment Finance, which works with business owners who struggle to get approved for traditional loans.
Commercial Fleet’s entire application is a one-page form. Fill it out, provide a bill of sale, and you could be approved in as little as 24 hours. For loans below $150,000, you don’t need to provide tax returns, and some semi-truck business owners won’t have to provide a personal guarantee.
Commercial Fleet claims to have semi-truck financing rates that compete with banks and credit unions, but those rates are not disclosed.
Commercial Fleet Financing is the best for quick application: It offers a quick online application that can be approved in as little as two hours and funds received within 24 hours. This is faster than a lot of other lenders, including banks and credit unions.
Who Commercial Fleet Financing is good for: Commercial Feel Financing is good for business owners with good credit who want access to low financing rates, a fast application process and quick funding.
TAB Bank: Best for semi-truck banking and loan
Overview: TAB Bank, an online bank, was founded in 1998. Business owners seeking funding can choose between various business loans, including business term loans, commercial real estate and equipment financing. The online application makes it easy and convenient to apply for a loan.
TAB Bank claims to offer competitive rates, but it does not disclose the rates, terms, or certain loan requirements, including minimum credit score, minimum time in business, minimum annual revenue. This will make it difficult for you to compare loan costs.
Why TAB Bank is the best for semi-truck banking and loans: TAB Bank offers both business banking and lending products. They have over 20 years of experience working with the trucking industry and offer a checking account and invoice factoring services tailored for truckers.
Who TAB Bank is good for: TAB Bank is good for semi-truck drivers who want business banking and lending to be done with the same financial institution.
What is semi-truck financing?
Semi-truck financing is when you take out a loan or lease to help cover the costs of a commercial vehicle. Similar to other types of business loans, it involves taking out a lump sum of cash for a fee and then repaying it over time with interest.
Depending on the lender, you may be able to apply for a term loan, which can usually cover any type of business expense. Or you may need to apply for equipment or commercial vehicle financing.
How does semi-truck financing work
When it comes to semi-truck financing, the borrower applies for a loan or lease through a bank, credit union or online lender. Depending on the lender, you may need to provide a down payment. Usually, the semi-truck acts as collateral, so you won’t have to provide an additional asset to secure the loan.
You will likely have to provide a personal guarantee, which is a promise to repay the loan even if your business defaults on the loan. So even if you are registered as a limited liability company (LLC), a personal guarantee will still make you liable for repaying your business debts.
The application process and approval times can vary, with commercial truck loans from online lenders usually providing faster approval and funding times. You’ll need to provide specific information like semi-truck age and mileage.
If you meet the lenders loan eligibility requirements and are approved, you’ll receive financing to purchase your semi-truck and will begin repaying the loan based on the terms laid out in your loan agreement.
Types of semi-truck financing
Business owners have different types of small business loans available to them when purchasing a semi-truck, including commercial truck loans, equipment financing, business term loans, and business lines of credit.
Commercial truck loans
This is a term loan that can only be used to purchase a commercial vehicle, including a semi-truck. Borrowers make payments for the term of the loan, and once all payments have been made, they own the commercial vehicle.
Equipment financing
This is a term loan that can be used to purchase equipment for your business, such as machinery and vehicles. Borrowers repay the loan within a certain period by making fixed payments. Similar to a commercial truck loan, at the end of the loan term, the borrower owns the equipment.
Business term loans
A secured or unsecured loan used to cover all types of business expenses. Loan funds are received in one lump sum, and the borrower repays the loan, plus interest, over a period of time.
Business line of credit
Similar to a credit card, a secured or unsecured line of credit is a revolving credit line that borrowers can withdraw from when they need to cover short-term business expenses.
Semi-truck leasing
You rent a truck from a company for a certain length of time while making lease payments. At the end of the loan, you turn in the truck and can lease a new vehicle. If you have a lease-to-own agreement, you can purchase the semi truck at a buy-out price. Insurance costs can be higher when leasing.
Pros:
- Fixed, monthly payments make the purchase of a semi-truck more affordable.
- On-time payments can build your business credit score
- Reduces out-of-pocket start up costs and frees up cash flow
- Fast funding depending on lender
- Tax deductions on loan interest may be available
Cons:
- Risk of repossession if loan payments are late or missed
- Late or missed payments can lower credit score
- Personal guarantee makes you liable if your business defaults
- Down payment may be required
Who should get semi-truck financing?
Many business owners turn to semi-truck financing when they don't have the funds available to make such a large, expensive purchase. If you're looking to start or grow your business, semi-truck financing could be the most viable option. Not only does it allow you to pay off the semi-truck over time, it has the potential to build your business credit score, reduce out-of-pocket start up costs and free up your business's cash flow.
Bankrate Insight
As you search for a lender, be on the lookout for red flags and other indicators of predatory lending, including the following:
- Unclear terms. Make sure your total loan, repayment schedule, interest rates and other costs line up with what you were expecting.
- High-pressure tactics. Don’t rush into a loan just because an aggressive lender is eager for you to sign a loan agreement. Try to work with lenders who give you time to look over a loan agreement and compare with other lenders.
- Double sales tax: Make sure you don’t pay sales tax twice for a leased semi-truck you decide to purchase.
- Hidden fees: Watch out for unexpected fees like origination, prepayment and maintenance fees. Look over your contract carefully. If there are excessive fees and penalties, get a few more loan offers and compare.
- Advance fee loan scam: Lenders shouldn’t ask for any upfront payments before an application is reviewed and approved. This type of fraud typically targets borrowers with low credit.
Where to get semi-truck financing
If you're interested in where to find semi-truck financing, loans are available through banks, credit unions, direct lenders and online lenders. Loan eligibility requirements will vary, as well as loan amounts, terms, interest rate, fees and funding time.