How to swerve around bad credit to improve your truck business?

Published on December 1st, 2020
  Written by 
Bill Tsouvalas
Bill Tsouvalas is the managing director and a key company spokesperson at Savvy. As a personal finance expert, he often shares his insights on a range of topics, being featured on leading news outlets including News Corp publications such as the Daily Telegraph and Herald Sun, Fairfax Media publications such as the Australian Financial Review, the Seven Network and more. Bill has over 15 years of experience working in the finance industry and founded Savvy in 2010 with a vision to provide affordable and accessible finance options to all Australians. He has built Savvy from a small asset finance brokerage into a financial comparison website which now attracts close to 2 million Aussies per year and was included in the BRW’s Fast 100 in 2015 as one of the fastest-growing companies in the country. He’s passionate about helping Australians make financially savvy decisions and reviews content across the brand to ensure its accuracy. You can follow Bill on LinkedIn.
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There are other ways to finance your business such as a truck finance that can help you swerve out of your bad credit woes of not getting a loan.

The Australian economy is supported largely by small businesses which make up almost 97% of the economy. Truck Dealers in Australia released a report showing that the trucking industry is worth the investment with an annual growth of 2.7%, generating a revenue of $4 billion from 2012 to 2017. It comes as no surprise why you would want a slice of the cake too.

However, bad credit can put potholes on your route to securing a loan

Bad credit can prevent you from getting any future loans or credit from financial providers. If you have defaulted on any of your payments by; failing to pay your bills on time, applying too often for credit, or being overdue on payments can count against you on your credit file. Australian businesses are currently running debt at about $918,658,677 according to the Australian Bureau of Statistics. This can cause you to be part of the 60% small businesses that shut down within the first three years of starting. 40% of these businesses closed due to inadequate cash flow or high cash use.

What listings are bad for your credit file?

You might be wondering what is the criteria lenders use to determine whether you are up to scratch to receive a loan. It is advisable that you always check your credit report constantly to see if all is up to date, and that there are no mistakes. You can order a copy of your credit file at Australia’s credit reporting agencies such as Equifax, Dun & Bradstreet or Experian.

Some of the few listings that can count against your credit file are:

  • Defaults in payment
  • Bankruptcy if you are unable to pay your debts. This listing can remain on your file for the next 5 years.
  • Being summoned to court due to debt will also be listed on your file.

When it comes to securing a loan for your business, your credit file can either speak in high favour for you to lenders who will view you a trustworthy person or a risk. Either decision can have a great impact on where you will be taking your truck business.

There are still alternative ways to open doors for your business

Bad credit can limit your access to certain doors, but it doesn’t shut all. There are loans that can help you purchase your new set of wheels that can be an addition to your business to move it forward. Personal loans can be an alternative resort, or even a short-term loan if you urgently need the money. It’s advisable to speak with a reputable financial creditor that will be able to further assist you. Opting for a debit card can help you spend wisely and decreases your chances of running multiple credit card debts that will keep you in the red for long.

Try to improve your credit score over time by doing things that will benefit your funds and business in the long run. By paying your bills on time, limit the number of times you apply for credit cards or loans, and having a consistently low balance on your credit card can be one of the many things you could do to give you a good credit rating.

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This guide provides general information and does not consider your individual needs, finances or objectives. We do not make any recommendation or suggestion about which product is best for you based on your specific situation and we do not compare all companies in the market, or all products offered by all companies. It’s always important to consider whether professional financial, legal or taxation advice is appropriate for you before choosing or purchasing a financial product.

The content on our website is produced by experts in the field of finance and reviewed as part of our editorial guidelines. We endeavour to keep all information across our site updated with accurate information.

Approval for commercial loans is always subject to our lender’s terms, conditions and qualification criteria. Lenders will undertake a credit check in line with responsible lending obligations to help determine whether you’re in a position to take on the loan you’re applying for.

The interest rate, comparison rate, fees and monthly repayments will depend on factors specific to your profile, such as your financial situation, as well as others, such as the loan’s size and your chosen repayment term. Costs such as broker fees, redraw fees or early repayment fees, and cost savings such as fee waivers, aren’t included in the comparison rate but may influence the cost of the loan. Different terms, fees or other loan amounts may result in a different comparison rate.

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