Are you looking to expand your logging equipment fleet in an affordable and viable way? Although not the best solution for everyone, logging equipment financing can be a great option for certain logging businesses. From forestry equipment loans to used logging equipment for sale, there are an abundance of options when it comes to supplying your business with the reliable, quality equipment it needs to succeed.
Before heading down the logging equipment financing path, take a look at some of the ins and outs of equipment financing we’ve compiled below and prepare yourself to make the best decision possible for you and your company.
Credit Honesty Goes a Long Way
Before any lender can make an informed decision, they need to know the reality of your current credit status and where your business stands, even if neither are where you’d like them to be. In order to make a good decision about whether or not logging equipment financing is a good move for you, lenders need to know the facts. Of course, this also means you can and should highlight the positives of your business, including the areas in which it’s excelling and thriving.
Keep in mind that if you aren’t frank about your credit history and the lender comes across troublesome information, they will be less likely to want to continue working with you. Here are a few examples of relevant information you should provide your lender upfront:
- A list of credit references, from banks and other lenders, timber mills, landowners, or other folks you do business with on a credit basis
- A layout of your business plan for the next 12-24 months
- Timber contracts that are currently in progress, as well as secured future contracts
It’s also good to note that your logging company’s annual financial statement, prepared by an accountant, usually looks much better to lenders than a tax return. An annual financial statement is far easier to read and more often than not depicts a better financial position of your business. Investing in an accountant-prepared annual statement is something that can pay off in the long run by putting you in the position to be approved for a higher credit amount.
Why Opt for a Forestry Equipment Loan?
Offered by a bank, forestry equipment loans are loans given to logging companies in order to help them purchase new and otherwise expensive logging equipment for the continuance or betterment of their logging operations. Generally, forestry equipment loans offer low, fixed-interest rates and long-term repayment plans that can offer an affordable and sustainable way for logging companies to buy expensive, but necessary equipment, and stay in business.
Keep Your Lines Clear
While this one almost goes without saying, it can still be more difficult in practice than in theory: keep your lines of communication open and clear between you and your lender, especially if you encounter financial difficulties during your loan repayment period. Telling your lender sooner rather than later will actually work in your favor, as a lender’s options (including the potential repossession of your logging equipment) become more limited as time goes by and your financial difficulties increase. Even if you’re “certain” you’ll come out of a rough spot, keep your lender in the know and always know your options along the way.
The more knowledge you have about forestry equipment loans, logging equipment financing, and the best ways for your business to buy new or used logging equipment for sale, the better you and your business will be in the long run. Stay informed, know what works in your favor and what doesn’t, and let logging equipment financing be the path to keeping your business efficient, sustainable, and profitable for years to come.
For more information or to learn about rates, logging equipment loan options, and logging equipment for sale at Papé, contact our sales and financing experts today.