Have you ever been denied a loan due to a lack of credit history? Too young, not enough comparables, and so on!
When your company is taking steps to purchase its first heavy-duty truck, you may face a refusal for the same reasons. Today, we explain how to avoid this.
In the previous article, we saw that there are several types of businesses: startups, fleet managers, and large-scale fleets.
To build a strong relationship with lenders, they like to review comparable purchases and ensure there is no recent history of bankruptcy. They may also request a full review of your company’s financial statements.
Just like you, your business has its own credit profile. If your company is in its early stages, lenders will review both the company’s credit file and your personal credit.
If your personal profile meets lenders’ requirements, they may ask you to personally guarantee the loan to acquire your new truck. This is called a personal guarantee.
For fleet managers and large-scale fleets, since the company already has an established credit history, personal guarantees are requested less often.
If your business requires a personal guarantee, keep in mind that good payments build strong relationships. Proper financial management helps reduce risks to your personal assets when providing a guarantee.