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[url=http://RAILTRAINS.INFO/ctg.php?category=10&page=1]Lifting heavy equipment[/url]
Imagine this. The year is 2008. The U.S. is in the midst of one of the worst housing crises in ages. There are more foreclosures than ever and it's expected to get worse. Two hundred and sixty or more major mortgage lenders have gone out of business. The mortgage companies that are still in business are suffering at the hand of major monetary losses. Mortgage lending is very challenging to say the least. Home values have declined significantly. Millions of people owe more on their home than what a sale would yield. The credit crunch started in the home loan market, but has trickled down to numerous other credit markets including auto loans, personal loans, business loans, and equipment loans. The banks have tightened up big time. Wait, wait just a second. I'm not imagining this. It's reality. So, you're in the market for some new construction equipment, but you have lower credit scores and the bank has turned you down. You say to yourself, "what do I do now"?Just because the bank said no, that does not mean you don't have options when it comes to leasing your construction equipment. The first option is to buy repossessed equipment or to buy equipment that was turned in at the end of a lease term (off lease equipment). The first thing that many people might think is-"hey, I can get a great deal (price) on repossessed equipment". This is partially true. You get an awesome deal, but it's not necessarily the price. There is still decent demand for heavy equipment, so generally the prices are not slashed like one might imagine. Here is the sweet part of buying off lease equipment. There are one or two lenders that hold on to their off lease equipment rather than selling it at an auction. The beautiful thing in this case is that they have dramatically relaxed their credit criteria for their off lease equipment. At this point, one can get a new piece of equipment up to $250,000 with just a simple application (no tax returns, no bank statements, no time in business requirement, no down payment requirements, & eased bankruptcy requirements) and a 575 or higher Trans Union score. In the middle of a credit crunch, that's amazing and you'd be hard pressed to find a deal like this at the bank. The key is to select off lease equipment and you generally need only one or two payments paid up front.A second option might appeal to business owners with really damaged credit (scores from 0-620), but have an equipment need that will generate considerable income for their company. No matter what credit score a business owner might have, he/she can get the equipment they need if they have secondary collateral available. In every equipment lease or loan transaction (meaning-good or bad credit), the piece of equipment being purchased is always part of the collateral and this is the same for the type of financing we're talking about here. The secondary collateral above and beyond the new equipment is simply to mitigate the risk of lending to a business owner that has a credit file that suggests they've had trouble paying some of their obligations. In the event of a repossession, lenders fork out a lot of money in legal fees and losses due to selling the equipment at discounted prices at auctions. Here is how the secondary collateral can help you get your new equipment (opposed to just telling you NO because your credit is poor). Generally, one would need a little more than a two to one ratio (collateral to new equipment). For example, If you're buying an excavator for $50,000., you'd need to furnish secondary collateral of about $58,000. The additional collateral can be equipment you own outright, real estate, land, c.d.'s, mutual funds, and any other non tax advantage accounts. It doesn't even have to be your collateral, it can belong to a co-signer.If your credit has taken some hits in the midst of the current credit crunch and you need to buy business equipment, don't dismay, there are options. Remember that you won't get A rates and payments. The most important thing to consider is how much money will this piece of equipment generate for your company. If it exceeds the cost, go for it.