Category Box Truck Financing Bad Credit/ No Credit Check

It’s common to hear that you need a good credit score to qualify for box truck financing. Your credit score is like a report card that tells the lender all they need to know about how you handle money and if they can trust to pay back a loan. But what if your FICO score falls short of the requirement? Lenders might respond with tougher loan conditions and higher down payments,  which can strain your finances.

Not everyone has the required FICO score for box truck financing, but that shouldn’t hold you back. Let’s break down everything you need to know about securing box truck financing with bad credit so you can make informed decisions.

HOW DOES CREDIT SCORE IMPACT BOX TRUCK FINANCING?

Your FICO score plays a major role in helping you secure a box truck financing. Although it’s just a three-digit number, it goes a long way in telling the financing companies how well you manage money. It also determines how much they are willing to lend you and the associated loan terms.

Ideally, you should aim towards building a healthy FICO score which means higher digit. Higher scores can guarantee fast approval time and more favorable loan conditions. On the other hand, a lower score does not necessarily mean you will not get approved for a loan, it is just that the loan terms may lean more to the advantage of the lender. 

Equally important to consider is the impact box truck loan application can have in your FICO score. Every time you apply for a loan, it triggers a hard inquiry or hard pull, which temporarily lowers your score. A hard inquiry occurs when a financing institution requests a detailed review of your credit report from a credit bureau. Each hard inquiry gets recorded on your credit report and directly impacts your score by reducing it by 5-10 points. If you apply to many companies requiring hard pulls, your score could drop significantly, making it harder for you to qualify for loans in future.

So what do you do to maintain a healthy score?

1. Know your FICO score before applying
2. Use financing companies that use soft inquiries instead of hard inquiries so as not to impact your existing score
3. Conduct research before applying for loans to limit your applications. 

OVERVIEW OF FICO SCORES FOR TRUCK FINANCING

Before we dive into navigating bad credit for your box truck loan, let’s have an overview of FICO score ranges and what they mean. According to research, the following are the breakdown of FICO scores and what they mean.

• 300-579: Poor
• 580-669: Fair
• 670-739: Good
• 740-799: Very Good
• 800-850: Exceptional

In general 67% of Americans have good FICO scores and better. With a good credit score, you can get favourable loan terms, while a lower than required score is often considered bad credit.

WHAT AFFECTS YOUR CREDIT SCORE?

The difference between a fair and good FICO score may seem small, but it carries significant weight. The range you fall into can determine whether you’re instantly considered for a loan or not.

We already discussed how hard inquiries can negatively impact FICO scores and drop them by 5-10 points. Plus, if you have multiple loan companies conducting hard pulls, it can drop your score by a lot. In a nutshell, you want to be mindful of those factors that impact your credit score and manage them well. These factors are highlighted below: 

1. Payment History: This takes 35% of the factors impacting your overall score because it shows how you handle paying up your loans. 
2. Debt owed: This is the total amount of debt you have compared to your available credit limit. It takes 30%.
3. Length of credit history: Refers to how long you’ve been using credit which accounts for 15%
4. New credit: 10% of your score is determined by the amount of new accounts you have and if you have recently applied for a new one. Note that opening too many accounts in a short while can impact your score.
5. Type of credit: Having a mix of different types of credit cards like mortgage, installment loans and car loans impact your FICO score by 10%.

Related article: How To Choose The Right Tow Truck Financing Option

BOX TRUCK FINANCING WITH BAD CREDIT OPTIONS 

Unless you’re opting for the lease option that does not require your FICO score, getting a box truck with bad credit can seem difficult. Let’s look at some of the implications of getting a box truck bad credit financing.

• Higher interest rate loans: With a less than required FICO score, lenders are likely to hit with higher  interest rates.
• Higher down payment: Also expect to part with a higher down payment which can be in the form of a percentage of the total loan amount.
• Strict payment term: Repayment of loan is determined by the lender, and with a poor credit score, they want to make sure you pay the loan within the quickest time .
• Difficult to get a lender: There are many financing options including credit unions and banks. Regardless most of them will want to see  a healthy credit score

HOW CAN I GET BOX TRUCK FINANCING WITH BAD CREDIT?

By now, you likely have an idea of where you stand and can determine if you qualify for box truck financing by assessing your credit situation. The good news is that even if you do not meet up with the credit requirement, you can still get financed. 

At Inspired Funding, we evaluate everyone’s unique financial situation to help determine the best way to assist. That is why we offer box truck financing with no credit. Additionally, you can explore other box truck financing programs to find the option that best suits your needs.

Other benefits of partnership with Inspired Funding include:

1. No minimum FICO score on box truck leasing
2. No minimum credit score for box trucks
3. No hard inquiries 
4. Low down payments on used box trucks. 

BOX TRUCK FINANCING WITH NO CREDIT WITH INSPIRED FUNDING 

The more hard inquiries you get on your credit, the greater the impact. That’s why it’s better to work with lenders that perform soft inquiries just like we do at Inspired Funding. Credit checks are necessary, but having less-than-perfect credit doesn’t mean you have to give up. Our box truck financing offers are designed with you in mind so that you can get your dream truck and hit the road as soon as possible.