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View Full Version : How much debt do you have?


ColePyck
05-16-2007, 10:31 PM
So I have been thinking a lot about getting a new truck, which would bring my business into more debt. I can justify because my older half ton is on its last legs. Then I look around at the largers companies in town and think that they must have HUGE amounts of debt. So how large are you and how much debt do you guys carry with still being able to sleep at night ?

FIRESCOOBY
05-16-2007, 11:07 PM
I am solo and only have what is listed below.

Everything is paid for minus the truck and I currently owe $15,379.57 on it. I will be selling or trading the Mini-Z in on either a SuperZ or Exmark next Spring. I won't be financing it though. Pay only cash or it doesn't get bought.

ALarsh
05-16-2007, 11:09 PM
Under $4k of debt and I have all the equipment that I need and a full route.

T.E.
05-16-2007, 11:10 PM
Zero debt, and my plan is to keep it that way.

procut
05-16-2007, 11:34 PM
I have about $14,000 in business related debt.

Prestige-Lawncare
05-16-2007, 11:42 PM
Not counting the truck .. which I had before starting this full time ... $0.00 debt. All equipment is paid for in full.

With that said ... truck payment ... mortgage ... camper ... and the usual host of other bills ... cell, satellite TV, utilities, ... and the biggie ... 2 teenagers!!!

fiveoboy01
05-16-2007, 11:46 PM
Truck loan balance is around 26K...

The 36" exmark which I bought a couple weeks ago, that's around 4800 or so.

The truck is 0% for the life of the loan, and the mower is no payments, 0% interest for a year. We'll have it paid for well before that.

All my other equipment/trailer etc, I do not owe anything on.

Mr Priceless
05-16-2007, 11:54 PM
i have about -$170.00 in debt. in otherwords, people owe MEpayup

Mark13
05-16-2007, 11:59 PM
i have about -$170.00 in debt. in otherwords, people owe MEpayup

I guess its better to be owed something than to be oweing someone something.

KS_Grasscutter
05-17-2007, 12:00 AM
About $2400 on equipment, and $3000 on my Chevy truck.

stroker51
05-17-2007, 12:03 AM
uhh, too much? No, I'm in for about $2700 on my 737 Deere Mid-z, about $6000 on my Deere 657A quiktrak, and about $2000 on my FSuperduty dump. So what, like $10,700, this is my first full time year, as in workin almost everyday, although I've been doing only this as my source of income for that last 4-5 years, all through high school, now it's out in the real world, so it'll be a different deal. The good thing is is that I signed one medium sized maintenance account new this year that will pay, in theory, all that debt off. I have more than enough work from before, plus all kinds of new jobs to pay the other bills and myself. I also have a 1996 F250 PSD 4x4, paid off, 2006 Eagle 18' trailer, paid cash, Deere 48,36, and 21 w/b's, cash, and all the handhelds.

Mr Priceless
05-17-2007, 12:08 AM
I guess its better to be owed something than to be oweing someone something.

that is, if they pay what they owe when i want them to:hammerhead:

Envy Lawn Service
05-17-2007, 12:24 AM
You guys should be proud of me now.

I actually have two little accounts for business... just to show 'activity'.

I actually owe $1,400 on both.

One is a 0% deal on a Dell Preferred Account for one kickazz business computer.

The other is a local in-house account for misc stuff, which also 'reports'.

Aside from this 'activity', I pay cash for everything... both business and personal.

B&M
05-17-2007, 01:04 AM
Just have the w/b and I what to keep it that way.

David Gretzmier
05-17-2007, 03:24 AM
let's see- business real estate, about 30,000, 2006 ford, 15000, and all other business assets paid off. be careful getting deeper in this business. the equipment and trucks wear out about as fast as you pay them off.

Richard Martin
05-17-2007, 04:03 AM
My total debt is about $18,700 of which about $3500 is business related.

qualitylawnlc
05-17-2007, 01:27 PM
Less than $4000.00 total. Could be more, but I love my old Dodge. Don't have the heart to part with it and upgrade. It gets the equipment where it needs to be and that's all that matters.

OMG
05-17-2007, 02:34 PM
Except for a mortgage on one rental house of about 18k, I owe no debt.

That includes all rental properties, trucks, cars, trailers, boats, business equipment, etc.

No credit card debt,.....haven't carried over a balance on a credit card in 3-4 years.


Cash or debit card only (hopefully) from here on out.


All my monthly bills (utilities, insurance, etc.) are on draft.


Took me years to get this way and it sure makes life easier.

WJW Lawn
05-17-2007, 02:56 PM
I owe a touch over 4500...and thats it.

Reliable Lawns
05-17-2007, 03:07 PM
0 debt on on lawn truck and any lawn business equipment. The best way to be if possible. Good luck

rodfather
05-17-2007, 08:59 PM
20 grand maybe, that is nothing for me.

mslawn
05-17-2007, 09:32 PM
I would say about 35000.00 on equip. and 25000.00 on 1 truck. However, there are 7 exmarks, 3 trucks, 1 new holland tractor with all the goodies, 1 polaris ranger, several smaller pieces of equipment (such as aerators, tillers), tons of handhelds and 4 trailers.

ColePyck
05-17-2007, 09:33 PM
20 grand maybe, that is nothing for me.

that makes me feel a little better, it seems that you almost have to be in debt to run a business when you are growing. I know these companies with 20 trucks and 100 employees must carry 20 plus grand in debt

ed2hess
05-17-2007, 09:43 PM
that makes me feel a little better, it seems that you almost have to be in debt to run a business when you are growing. I know these companies with 20 trucks and 100 employees must carry 20 plus grand in debt

Maybe a lot more than that......we got a new start up in our area that probably has over $500,000. All new cab over truck and equipment and a a place for this stuff. He sold out to Trugreen about 7 years ago and now he back into building another business.

Zaro T Man
05-17-2007, 10:09 PM
I am in for about $2,500.00 0% interest on that loan got lucky. I use an older I think 98 F150 that is clear. I am picking up decent numbers so am feeling good.

stuffdeer
05-17-2007, 10:14 PM
4,950 Dollars for the new mower I'm picking up next Thursday

Liquidfast
05-17-2007, 10:24 PM
I OWE it ALL to my mom, wife and brother. They believed in me, financed me for EVERYTHING and I owe $615 per month for a leased truck.



For the guys starting out. I have to say there will be times where you don't know where your next meal will come from but if you are true to yourself, fair to your customers and believe in your work, there is no limit on what you can earn.

DBL
05-17-2007, 10:25 PM
about 23k total....4 trucks...2 trailers...3 mowers...tons of other equipment...and thats the credit card too

barefootlawnsandlandscape
05-18-2007, 08:21 AM
Debt is not a bad thing. Everyone acts like it is horrible for your business to be in debt. If you can make money off of that debt then it's not a bad thing. A $400 truck payment can produce $800 in revenue a day if it is pulling the right equipment, about another $400/month. The key is finding the right people to ride in that truck and do a quality job for you. I will not tell you how much debt I am in, but I can tell you that my D/E ratio is still right where it needs to be.

Personal debt is another story. I try and keep that free and clear on the personal side except for mortgages.

TGM
05-18-2007, 09:34 AM
two words:

A LOT


no, there seems to be a need for debt or a good amount of money set aside to get into this busines...not just a mower and a trimmer, but the extra tools, business supplies, nicer equipment to look professional and be more efficient.

you may be able to start off cheap, but the need for tools will increase the more you get into the lawn care/landscaping business.

topsites
05-18-2007, 09:48 AM
I don't foresee the banks handing over $20,000 of their money to a 20-odd y.o. who hardly has any credit history, but that's just me. There are ways to do it, one guy I recall pulled a few rabbits out of his hat, ended up being handed down an 8 year prison term by a judge.

Because most folks pull that kind of stunt, within one year they're so broke it is really hard to see their way out of that rut... There's no such thing as a free lunch, most of the long-term Lco's here didn't go the way of bank loans, at least in my case I saved my money, and it was hard starting with only 5 grand instead of 10 or 20, but then I had no payments (+ interest) to burden me.

The first year is a bit rough, that has to be the understatement of the century, I almost didn't make it and my first loan didn't come my way until my 4th year... Even then I was amazed they gave it to me and it was hardly 3 thousand dollars. It was a 0% no payments no interest loan, I think I made 3 or 4 larger payments and it was over, but easy it still was not because I only had 12 months to do it in.

Now I've got a Z today that's on a 36-month no payment / no interest term, but I'm in my 6th year and the payment is drawn from my account every month, then I have the money in a High Yield MMA to cover it just in case... It just so happens the HYMMA earns me interest while the loan costs me nothing, but then that's because I don't borrow, a loan to me is but the optional way of doing things if it's actually cheaper to do it that way, but in most cases it doesn't work like that and I pay cash.

Either way, for those who want to plunge head first, don't bump your head on the bottom, the water's a bit dark.

Peace

RedMax Man
05-18-2007, 02:13 PM
Debt Free, and i hope to keep it that way as long as possible.

Stillwater
05-18-2007, 04:55 PM
If you maintain zero debt 100% of the time, it is then impossible to have great credit. I owe 2 grand on a truck and charge about 1 to 5 grand a month or more depending on what is going on in expences gas,oil,mulch,seed,loam,fert,plants,stone, all are billable charges.

JJLandscapes
05-18-2007, 05:14 PM
If you maintain zero debt 100% of the time, it is then impossible to have great credit. I owe 2 grand on a truck and charge about 1 to 5 grand a month or more depending on what is going on in expences gas,oil,mulch,seed,loam,fert,plants,stone, all are billable charges.

makes no sense. If you pay your balance in full every month you technically have no debt yet your score will go up. When you pay it off in full every 1-3 months you raise your credit limit.... Once your ratio of debt to line of credit gets even wider your score will rise. Theres a million factors involved and your score goes up with no debt. SIgned up to myfico.com and they have the scorewatch that emails you everytime your score goes up or down

topsites
05-18-2007, 05:29 PM
It is an idiotic oxymoron that it almost seems like you have to take on huge debt to build credit, but it's not entirely true, that's the half they want you to believe. Fact is, your Fico is and will be about where it should be, and either way it takes time, years.

Now you can do it the way I've done it twice, which is get a small limit credit card and use this to charge expenses, and make sure to pay it off in full every month, and keep doing that while you save money. Over a period of time of 5-10 years, the banks will offer you juicier credit cards with no annual fees and lower apr's and higher limits, and this will give you more flexibility but you still have to always be dang careful.

You can try it the other way but you're just dragging yourself down, the credit places would like for you to believe that this is the way to go, but then they earn their money in this fashion, and take it from someone who's been down in that rut of being 20 - 30g in debt, that method SUX!

The thing is if you save your money, it takes years but once you get to having 10 or 20 grand in the bank, there comes that time they start to offer you 0% loans, and those are the kind to get... They know you can pay them off (for one you have the money) and technically speaking they're trying to squeeze you but you can not let that happen. You take their loans for the only reason being that you get to keep your money earning interest as you pay it off, still one has to be dang careful because I really like having the money that I saved in the first place, you see what they're doing is an awful game of trying to connive you and I of our hard earned moolah LOL.

So don't fall for the bait, save your money and go cash only for a long time if that's what it takes, let the pieces fall into place because it doesn't take forever, best I can tell you. Probably in a couple of years you might have a few g, even now might be a good time to check into a $500 limit credit card with no annual fee, that's how I got going, my business credit card had a $500 limit for some time.

Stillwater
05-18-2007, 06:35 PM
I have an American Express Bussiness line of credit it works well, the cards are paid in full automaticly monthly. Amex is great at tax time aswell. Biz credit is completely different than personal credit.

business credit scoreing is called a PAYDEX Score. The PAYDEX Score is a unique dollar-weighted numerical indicator of how a firm or business payed its bills over the past year. PAYDEX Scores range from 1 to 100, with higher scores indicating better payment performance. It is totaly different than FICO personal scoreing.

rodfather
05-18-2007, 06:55 PM
Debt is fine as long as it's managed properly.

ChadsLawn
05-18-2007, 07:08 PM
I owe $0 as of this past march.. Im so glad I have to equipment bills.

Stillwater
05-18-2007, 07:43 PM
I owe $0 as of this past march.. Im so glad I have to equipment bills.

Hey My grandparents lived on Knowellwood dr. any accounts on that street?

mountain man
05-19-2007, 06:56 AM
Debt is fine as long as it's managed properly.


I agree. Basic cash flow management.

The problem is most guys have to go out get the biggest equipment vs the most profitable equipment. That new $35,000 truck will not produce any more revenue than the 5 year old - but still professional looking looking - truck at a third of the price.

Sydenstricker Landscaping
05-19-2007, 08:19 AM
I owe 8 grand still on my truck. My equipment is all bought and paid for in cash!!! The only reason I had to get a loan for my truck is I didnt have 10 grand laying around to buy it, lol. And I also have a 500 dollar limit card which I use for my business and gets paid in full every month. I am happy with what I got

Tim Wright
05-19-2007, 08:45 AM
I agree. Basic cash flow management.

The problem is most guys have to go out get the biggest equipment vs the most profitable equipment. That new $35,000 truck will not produce any more revenue than the 5 year old - but still professional looking looking - truck at a third of the price.

This depends on the reliability of either truck.

Tim

PatriotLandscape
05-19-2007, 05:46 PM
Counting trucks and equipment we are about 71k out with notes. I don't really consider truck loans as debt in the same sense as our line of credit though. Like football it is all about cap management don't spend more than you can bring in to pay the bills.

Stillwater
05-21-2007, 02:01 AM
I think their are like 6 Patriot Landscape companys in MA. Are they all the same company? do you own them?

Jpocket
05-30-2007, 08:31 PM
My business has no debt, I do have one truck that I owe money on but that is my personal truck.

txgrassguy
05-30-2007, 08:39 PM
With out looking at all of the replies, a solid business model predicates, on average, to have a asset to debit ratio of 7:1.
Anything beyond this ratio will affect your credit rating, ability to borrow towards capitalization, and generally be a pain in the ass.
That said my current ratio is stabilized at 7:.05 so I'm okay for the time being.

SiteSolutions
06-01-2007, 11:26 PM
To sum up, I owe about $60k - $65k on all business-related debt, and I am aiming to have gross receipts around $115k - $150k for 2007. The debt is mostly on an old C-7000 dump truck, newer (but not new!) F-350, and a Bobcat.

I'm definitely on the deeper end of the debt pool but I do loader work which requires a costlier machine (~$25k for a used T-190), bigger trailer, and a truck that can safely & reliably pull 10k pounds around. All of that stuff is starting to become profitable as I learn how to keep it busy and charge what the work is worth.

Hopefully debt will become a much smaller part of my life as I move forward, but for now I am ok with it. Can't wait to be able to put that $1400 or so a month in the bank instead of making payments.

Digdug
06-03-2007, 06:46 PM
Reading these posts makes me envious. I have a around a million plus of debt. No i'm not bullshtting.

bishoplandscape
06-03-2007, 07:43 PM
I'll just say we wright out about 8,000 a month in payments. And the fuel is really starting to hurt. But what can you do!;)

WHIPPLE5.7
06-03-2007, 07:44 PM
Age 28. I owe nothing business related because I'm still to small and don't spend big until I have the clients first. I do have enough cash socked away for an Exmark Metro 26 and a Quick 36 for next season but for now I don't need then quite yet. I owe $45,000 on a $200,000 home and I owe $9,000 on a 2005 GMC Sierra. For my business I currently own a 1997 2500 Chevy in nice condition, 2 trailers setup for lawncare, 2 Honda 21" mowers, 2 Yard marvel powerrakes, 1 aerator, 2 ATVs setup for work, 1 little wonder edger, Echo trimmers, Landa 13 H.P. Honda belt driven pressure washer, concrete stamps and molds, etc. Not bad considering I had a failed business only 2 years ago that hit me for about $35,000 out of pocket, it was a mold and fire prevention application company and poeple around here liked the idea but wouldn't put out for the service to be done. Atleast in lawncare poeple are almost obligated to do it or have it done.

SiteSolutions
06-03-2007, 10:41 PM
Reading these posts makes me envious. I have a around a million plus of debt. No i'm not bullshtting.

What sort of stuff does a million in debt get you? Big machines, or just a lot of them? I know a couple big Cat machines and a couple dump trucks could hit 7 figures real quick...

Digdug
06-04-2007, 06:41 PM
What sort of stuff does a million in debt get you? Big machines, or just a lot of them? I know a couple big Cat machines and a couple dump trucks could hit 7 figures real quick...

Hi Site, yes i am in the excavation & demolition business , and also develop subdivisions. I do have numerous equipment from skid steer to 40 ton excavators , and everything in between. Along with Mack trucks for hauling material and moving equipment. I really do love my job or i would have quit by now , but seeing in this thread that some people have no debt really makes me wonder some times if i am doing the wrong thing. I enjoy coming to this site for ideas on taking care of my own house and properties. But i did start out 15yrs ago with a skid steer and a Walker mower , so i have roots to the lawn service industry. As a matter of fact we still have a Wal-mart maintence contract that we do (plowing & mowing). So the moral to the story is .... the more your make the more it costs. doug