I can pay cash but want to finance part of purchase

[ericscher]

Long story short...

My company's Tax ID is only a year old and although I am debt free I have no credit.

I am buying a new trailer and a used excavator,:
Trailer ~ $15,000
Excavator ~ $25,000


I can pay cash but I want to finance a small amount of each purchase to build credit, so this HAS to be done under the TIN, not my SSN.


You would THINK that this is easy.


Any lenders out there that are interested in working with me on this?

 

[lumberjack]

Find a lender for the equipment that does commercial loans. Finance part of the purchase price, pay for the rest. Not a big deal.

 

[Multiracer]

With large down payments and an established plan a local bank should be glad to help.

 

[monster76]

either route you go you will most likely have sign a personal guarantee and as long your business bank statements going back like 6 months are decent you should be able to do it

 

[grandpa]

If you have the money to pay for them up front,,, why in the world would you ever want to finance a part of it? You say to build credit? Those machines all payed for would be credit enough for me!!!!!!

 

[lumberjack]

I'm 28, credit is a valuable tool and setting yourself up for the future is an important thing.

 

[CM1995]

If you have the money to pay for them up front,,, why in the world would you ever want to finance a part of it? You say to build credit? Those machines all payed for would be credit enough for me!!!!!!

Listen to the old fart, he's right. Pay cash, own it and earn money with it. A successful business is built on wealth, not credit. Credit can be taken away with a blink of an eye.

 

[grandpa]

Listen to the old fart, he's right. Pay cash, own it and earn money with it. A successful business is built on wealth, not credit. Credit can be taken away with a blink of an eye.

Ha Ha.... you learn well Grasshopper.

 

[lumberjack]

Credit is a too, just like money in the bank. Kubota offered me 0% and .8% interest on my last two purchases... I can make more money with my money than I pay in interest using their money. Living on credit is moving backwards. Exploiting others "cheap" money is a venture... nothing ventured nothing gained.

I am super small potatoes, but I still "make" a couple grand a year in cash back with vendors that do not give a discount for cash/check transactions. I wouldn't have the option to "make" that money without my credit.

 

[CM1995]

Ha Ha.... you learn well Grasshopper.

Yeah, whatever.

Blow it out your frigid windpipe.

 

[AlldayRJ]

The trailer dealer cant find you financing? I agree with you, debt is a tool you can use.

He has the cash, theres just no reason to fork it all over at once. I would rather have a cash cushion if you have to fix the excavvator or something

 

[JBGASH]

A very simple solution to that problem; get the loan under your name & social security # DBA as your company name, any bank should be willing to do business with you in this manor. I agree with you completely on building your credit, the only way to do so, is getting and paying loans & bills timely - a very important tool in this world & business today. This is especially true & very important if the time comes when you need a bid & performance bond for a construction job.

 

[grandpa]

Debt is a tool you can use? Guess I can't see the reasoning.

 

[lumberjack]

Example, 8 ton Kubota excavator and some misc attachments. $105k cash or $110k financed for 60 months at 0%. Which would you do (assuming you are not independently wealthy)? Independently wealthy folks have different issues.

I would keep the $105k in cash... I can turn $100k into $105k in 6 months no problem. I can't make that $5k if I don't have cash... and it would require lots of hours to make that $5k in 6 months with the excavator.

 

[lumberjack]

Last year I spent a bit over $80k in cash on a stump grinder and some attachments. I bought a Honda Pilot (0 down, ~3% interest, personal debt), a Kubota SVL90-2 (0 down, .8%, credit building commercial loan for the same company), and a F550 (20% down, 6%, credit building commercial loan for a new company) in that order totaling $123k currently. The Pilot was for my fiancé. The money I didn't spend on the SVL90-2 bought the stump grinder (it grossed over its cost just last year). I sold my older 550 and replaced it (and invested the money I made selling the old one) with the 2013 in November. Last purchase of 2014 was $25k cash for a grapple saw for my mini excavator, which opens me both direct and indirect profit potential.

 

[lantraxco]

If you have the cash, you can get a secured line of credit at your bank, it will tie up your cash in a savings account until you pay the balance back off, but it's very low interest and it will look good on your credit report after a while.

 

[nedly05]

I agree on building your credit. Put down a decent amount on both pieces and finance the rest. Maybe this is a generational way of thinking, but if you can put down enough money to get the payment where you're comfortable, and use someone else's money at a low interest rate why not go for it, and keep your money for operating capital. I got my kubota 121-3 for 0 down and 0% for 60 months. I felt like it was silly to even put anything down with that deal. Whatever works best for you, just go for it!

 

[rossaroni]

Example, 8 ton Kubota excavator and some misc attachments. $105k cash or $110k financed for 60 months at 0%. Which would you do (assuming you are not independently wealthy)? Independently wealthy folks have different issues.

I would keep the $105k in cash... I can turn $100k into $105k in 6 months no problem. I can't make that $5k if I don't have cash... and it would require lots of hours to make that $5k in 6 months with the excavator.

If you can make better money on your money somewhere else, why even buy the machine?

 

[grandpa]

Example, 8 ton Kubota excavator and some misc attachments. $105k cash or $110k financed for 60 months at 0%. Which would you do (assuming you are not independently wealthy)? Independently wealthy folks have different issues.

I would keep the $105k in cash... I can turn $100k into $105k in 6 months no problem. I can't make that $5k if I don't have cash... and it would require lots of hours to make that $5k in 6 months with the excavator.

You can turn 100k into 105k in 6 months no problem? I'd like to know what investment tool you know about that I don't.... that's 10 percent..... to me there is a high risk in that... no?

 

[JBGASH]

grandpa, To me, debt is most certainly a tool, use it wisely to make money with, in any business to prosper. On the other hand use it poorly and it will put you in the poor house. Examples of poor use- living beyond your means, new cars, big trips, too long of a stay in Las Vegas, too many new equipment purchases etc.

Debt is a tool you can use? Guess I can't see the reasoning.