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Running out of avaiable credit.. Should I lease?

Discussion in 'Business Operations' started by Bunton Guy, Oct 16, 2005.

  1. Bunton Guy

    Bunton Guy LawnSite Bronze Member
    Posts: 1,755

    We are expecting a decent size of increase in business
    (contracts in hand for Jan 1st.)

    We need to get a few new mowers & trucks etc... the income from this expansion will be more than sufficient to cover these new equipment purchases if financed. Im nearly tapped out as far as my debt to income ratio. Will leasing help us out at all? If I went to a commercial truck dealer right now to get a new truck they would tell me to get lost. I don't have bad credit at all....just to much out on my credit right now. Is there a different avenue that we should go down? We need 2 trucks for new crews and I was fairly set on leasing one (cabover) and paying cash for another (used F-350).


    Without 2 more trucks and 2 mowers etc... this expansion would not be possible. We have thought the process out all down to this one detail. My business partner has no credit at all (none established) so he can't help me there. Co-signers are not out of the picture but the ones I have used are also in the same boat as I am. I can put money down on each piece of equipment but nothing sustantially over a set limit (1K each)
  2. LB1234

    LB1234 LawnSite Gold Member
    Posts: 3,210

    Is used an option?

    Or just renting a truck from Hertz equipment rentals for specific jobs until the money starts to come in after jan 1st?
  3. Jpocket

    Jpocket LawnSite Silver Member
    Posts: 2,278

    If you can "turn wrenches" you need to get to maybe three older trucks paycash. Look into getting a late 80's c30 Chevy or two they can be had for around 3k. Then buy new mowers. When the big bucks start coming in trade in the old trucks one at a time. as to not over extend your self. These trucks if you find the right ones are very dependable.
  4. Bunton Guy

    Bunton Guy LawnSite Bronze Member
    Posts: 1,755

    Jpocket I had thought about that for a while..just a bit worried about more breakdowns than needed. It is an option floating through my head though.
  5. willretire@40

    willretire@40 LawnSite Bronze Member
    from VA
    Posts: 1,387

    I have always noticed that if you have good credit they never check to see how much you make. I have bought 5 new cars in my life and never had them ask me to see a pay stub or anything not even when i was a first time buyer. Hint Hint.
  6. Bunton Guy

    Bunton Guy LawnSite Bronze Member
    Posts: 1,755

    I don't have them ask for a pay stub either...they just always ask for a co-signer
  7. MacLawnCo

    MacLawnCo LawnSite Bronze Member
    Posts: 1,847

    Then your credit must not be that great.

    This is a prime example of what happens when a company exceedes their sustainable growth rate. Good luck figuring this one out.
  8. dvmcmrhp52

    dvmcmrhp52 LawnSite Platinum Member
    from Pa.
    Posts: 4,205

    You are trying to overextend your credit and it WILL bite you in the arse in a hurry.
    Buy used or something affordable, otherwise you won't be around to worry about new contracts.
  9. PLM-1

    PLM-1 LawnSite Bronze Member
    Posts: 1,640

    I just bought a new truck...I'm 21 and have an over 700 credit rating. They never asked me for crap. Just my socail security so they could check my credit.
  10. rodfather

    rodfather LawnSite Fanatic
    Posts: 9,501

    I say go the used route as well for the time being. In 12 years, I have never gone brand new with trucks.

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