Before you go out and try to buy that new truck, financial planners recommend checking your credit report as often as annually to root out errors. That’s especially true for owner-operators, whose business requires borrowing. One report usually costs less than $10. The major credit reporting bureaus are:
The coming of new low-emission engines has some owner-operators thinking about trading sooner than they might have planned. For some operations, buying a late-model used truck before the government’s Oct. 1 deadline makes more sense than paying a premium for a new breed of engine that gets slightly less fuel economy than today’s best engines.
Problem is, the folks in Washington, while eager to lower emission standards, did not lower credit standards. Unless you’ve logged some years as an owner-operator and have been almost squeaky-clean on your truck payments – as well as other payments that show up on your credit record – you could be out of luck in financing a truck. Or, at best, facing higher interest rates that add up to thousands of dollars.
The easy-credit days of a few years back are gone, at least for now, says Eddie Walker, owner of Best Used Trucks in Fort Worth, Texas, and president of the Used Truck Association. He offers these tips on financing:
DON’T RACK UP CREDIT CHECKS. Each additional credit check lowers your credit score, because the lending industry assumes multiple checks indicate someone who is a bad credit risk continuing to seek approval. It’s an unfair assumption, and the Used Truck Association is working to change the practice. But in the meantime, “If a guy goes shopping for the best deal and comes to my store and says, ‘I’ve gotten approved at three places, but I like your truck,’ I still have to turn him in to get financed,” Walker says.
IF YOU’RE BEHIND, DON’T GO FORWARD. Your payment history is a matter of record. To avoid wasting your time and the dealer’s time, don’t try to buy if you’re behind on your current payments. Find a dealer you trust, be honest about your financial situation, and he can give you a good idea of how to establish an adequate credit rating and how much truck you can afford.
BECOME A RECORDING ARTIST. With financial records, that is. Get them all; get them right. Suppose your local car dealer agrees to let you skip a payment. Get that OK in writing so you can contest what might show up as a missed payment on your credit record. Walker says he’s seen someone get stuck with a lemon of a car and finally persuade the dealer to take the old one and give him a new one, only to discover that the return got listed as a repo. Take nothing for granted. Document any transaction that could put you in a bad light if it were misinterpreted.