Financing for truckers has been a challenge in the recent past. However, the truckers still have several options despite the tough times. Borrowing costs have been at record lows in the recent past. The Central Bank of Canada has shown that they plan to increase the interest rates to deal with inflation. They believe that that's the only way to deal with inflation.
According to an article by Trucknews.com, truckers will face more than just issues with truck and trailer prices. Paul DeMarchi stated that it is challenging to assume the problems that owner-operators face. Rising interest rates are just one of the challenges they have now. In addition, freight growth has become slower, spot rates have gone low, fuel prices have risen, and insurance costs are also high.
Don Ludlow advised that truckers must assess their financial position before making decisions. They must understand how the rate changes would affect them. They must know how much debt they have now. Others must extend their debt maturity to keep their installments just as they are. Bav Malhi noted that the longer debt periods would also be handy for truckers. The same will give them ample time to service their debts. In addition, it will mean that they will be paying lower monthly payments.
Malhi noted that they had never seen such frequent changes in rates. Malhi added that the rates would only keep rising. The truckers who have plans to make purchases must make plans on time. They will incur high costs soon since the prices will only go higher. After every fifteen days, the central banks refresh the rates. Debts are essential to running businesses; however, debts should not help boost cash flow.
Truckers are advised not to mix personal assets with business. The same would create a whole new problem if the rates increased. However, those who can tap into their credit can do so. The only important thing is to assess their position before doing so. After that, the trucks must stand on their own. When acquiring a loan, the most important thing is to have a good repayment plan and a set purpose.
