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Loans?

Discussion in 'Starting a Lawn Care Business' started by GravelyWalker, Oct 10, 2012.

  1. larryinalabama

    larryinalabama LawnSite Fanatic
    Posts: 16,245

    Well hopefully after 5 years a 50K financed should "net" you 250000$, but I seriously doubt it can. Not to mention a 10k truck has the ability to preform the same duty as a 50k truck. At least you agree its a bad investment.
     
  2. grandview (2006)

    grandview (2006) LawnSite Gold Member
    Posts: 3,466

    Didn't say it was a bad investment. I worked for a company that had older trucks and you hoped they make it through the night plowing. I'm getting to old to be laying on the ground fixing stuff. Maybe down south your truck breaks ,your customers might not know if you show up late or the next day,you can make something up .When its snowing you better be ready. Yes I know a new truck can break too.
     
  3. 32vld

    32vld LawnSite Gold Member
    Posts: 3,984

    Hold on in the previous post you said if they don't have the cash it was ok to get a loan to buy a machine needed for that new account.

    Now you say no problem they can just pay the loan from their cash reserve.

    First you say get loans when you have no cash, then you decide presto changeo they have a cash reserve so all is good.
     
  4. 32vld

    32vld LawnSite Gold Member
    Posts: 3,984

    Wrong again. Bank will not allow the sale of a car that has an outstanding loan unless the 2nd buyer can satisfy the original loan. There is no automatic assuming of the original loan by the 2nd buyer.

    The bank will come after what ever they recovered on what they sold the repo'd car and will come after any part of the outstanding loan that the repo sale did not cover from the original buyer.

    Then you gloss over how getting loans at low interest rates will be gone for a very long time. Making borrowing even more expensive.
     
  5. MR-G

    MR-G LawnSite Senior Member
    Posts: 479

    just for thought...new ztr 50% down 150mo. for 24 mos.....completly under warrantee for 24 months....no repair costs at all...just routine maintenance....trade in value at end of 24 mos. is 50% of cost....trade in again hence 50% down is the used machine this time....rinse and repeat...we have 6 ztrs and have been doing this for over 20 yrs...never repairs, almost never down time, always have a new machine....for 150 a month...now that machine will generate over 8k a month if you use it wisely...this is a hell of a ROI (return on investment) oh and dont forget to take full depriciation at tax time on the 50% part of the machine you used....sometimes i really wonder how people get as far as they do.....
     
  6. Blades Lawn Maintenance

    Blades Lawn Maintenance LawnSite Bronze Member
    Male, from Baton Rouge, La
    Posts: 1,233

    Interesting...:) good point tho
     


  7. you can't make posts on here that make sense.
     
  8. MR-G

    MR-G LawnSite Senior Member
    Posts: 479

    we dont look at it as debt.....its part of the cost of doing business...if we didnt do it this way we would be spending more in the long run on hydro/engine repairs ect. ect.....this method has worked very well for us for over 20 yrs... the key is to keep the machines in top condition so you get 50% value at end of 24 mos....we also keep maint. records for each machine that we include when we trade/sell at the end of the 24 mos.
     
  9. MR-G

    MR-G LawnSite Senior Member
    Posts: 479

    you are right about that....LOL
     
  10. CL&T

    CL&T LawnSite Senior Member
    Posts: 493

    That's because no matter what you say there will be somebody who has their mind made up that you are wrong and won't take logic or common sense for an answer.
     

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