When it comes to goods movement, the trucking industry is often described as the backbone of the Australian economy. With approximately 246,100 people finding employment within this industry, there is one piece of equipment essential for keeping our driving workforce on the road – a heavy vehicle truck. Whether you drive B-doubles, B-triples, road trains or another type of heavy vehicle, these monsters are essential for driving Australia forward. A heavy vehicle purchase can be quite expensive, and a loan is often needed to purchase one which can require you to submit financial information and undergo a credit score check. If you have a bad credit rating, then this could mean you have troubles getting the finance needed for your next purchase. Does this mean that you won’t be able to make your next big truck purchase? Well, not necessarily…
What is a Bad Credit Score?
If you have a score of under 500 for most credit agencies, then this credit score means that you have a bad credit rating which can greatly affect the amount and conditions for you to borrow any money, not just funds for a heavy vehicle. For instance, you may have trouble getting approved for the full amount that you’re asking for or be offered a higher interest rate than someone with a good to excellent credit score. In saying that, having a low credit score does not necessarily rule you out for a loan since lenders look at a variety of factors when determining the success of your application. Although a lender cannot legally approve you for a loan if they don’t believe you will be able to service it, they do take into multiple factors alongside your credit score to determine your success in the applied loan that you’ve applied for. These additional factors include your income, general expenses, any other debt that you need to service, what the loan is for and the amount that you are applying for.
Not sure of your credit score? Check it now HERE.
What Does a Bad Credit Score mean for my Truck Loan?
If you have a bad credit score, it means that you need to cautious when applying for loans, as rejected applications can further reduce your ranking making it even harder for you to get the funds you are looking for. Before you apply for your truck loan, consider improving your application by saving a larger deposit for your new vehicle, meaning that the amount that you need to borrow will be reduced and, since you’re asking for a smaller amount, you could be more likely to be successful in your application. Just like a home loan, aim for a 20% down payment or more. Also, consider whether or not leasing the vehicle could be an alternative to purchasing. Finally, we recommend having a look at why your credit rating is low to determine if this is something that you can begin to improve. Some reasons for bad credit are easy to pinpoint, such as claiming bankruptcy. However, often a bad credit score is the accumulation of smaller negative notes on your credit report such as applying for too many credit cards, making late payments, having bills or payments over $150 overdue by 60 days or more, or having multiple balance transfer credit cards one after another. With this in mind, consider what you can do to reduce these reasons to start improving your credit rating.
When it comes to applying for the loan itself, it is vital that you enlist the team at Rostron Finance to help with your application. The team understands that, sometimes, there are a few potholes in the financial road that you may have hit and, although not ideal, this is okay. Rostron Finance offers a range of second chance financiers and will work closely with you to determine the best loan with different structure options including term, payment frequency and residual to find the best solution for you. This, in turn, will help to ensure your loan is successful so you can continue to move forward with your career driving Australia forward in your new heavy vehicle truck purchase.