Trucking Equipment Leases

We have had a bit of success lately with tractor and trailer leases. We have had a more favorable experience leasing this equipment type because the advance rates on the equipment is higher than traditional loan products. In fact, some of our leases have been financed at over 100% of the value of the trucks taken as collateral.

It seems that the leasing industry understands the equipment financing world much better than a traditional loan lender. The advance rates are typically better and some lenders will allow you to pledge other equipment assets rather than cash down. Lessors also can manage the monthly payments with a back end residual buyout value for the equipment. This can lower your monthly payment over the life of the lease. Traditional lenders confine you to a fixed amortization schedule and rate that don’t allow for payment flexibility.

These leases can be a little more expensive than money borrowed at the bank; however, the lessors risk tolerance, payment structure, speed to close and advance rates make it worth the cost to many borrowers. If you haven’t evaluated a lease alternative to your equipment loan, you really don’t know what you are missing.

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