Trailer Financing Basics

When you need a new trailer for hauling cargo and other items, but you don’t have the ready money for it up-front, then you have to find other ways to pay for it. Many buyers look instead of to financing options, which can help you get the trailer you need right now at a rate you can afford to pay. Here are some of the things to take into consideration when investigating your trailer financing options.

Create a Budget

First, you should take stock of your finances and determine exactly what you can afford. You’ll need to have anywhere from 10% to 20% of the total sticker cost saved up as a down payment that you give the dealer up-front. Then, you’ll need to figure out how much you can afford to pay in monthly installments for the duration of the loan, which could be over months or over years. Don’t forget to factor in the costs of maintenance and insurance.

Secured or Unsecured?

Loans typically come in two types: secured and unsecured. Secured loans require the use of collateral, which is something that the lender takes possession of, should the borrower default on the loan. Usually, this collateral is the trailer itself. Secured loans can be beneficial because they often let the borrower have more money and they may have lower interest rates.

Unsecured loans do not require collateral, but they can have higher interest rates and lower amounts for the borrower. Talk to your lender to determine what option is best for you. What you’re eligible for will also depend on your credit score, so it’s helpful to do everything you can to boost that before you purchase a trailer.

Ready to purchase a new trailer with financing options? Come on down to our dealership located in Hewitt, TX, to see what we have available. Talk to our staff if you’ve got any questions. Flat Rock Trailers proudly serves our Texas customers in Waco and Killeen.