Commercial trucks can be pricey, even used ones. But just because you can get a business loan for one doesn’t mean the monthly payments will fit your budget.
To figure out how much truck you can realistically afford to finance, enter the following details:
Desired monthly payments. Enter the amount you’d feel comfortable paying toward a truck loan each month. If you want to be more specific, include other monthly costs like insurance, gas and maintenance.
Sales tax. If your state charges a sales tax, enter the rate here. If you’re planning on paying taxes out-of-pocket, leave this part blank. Trade-in value of existing truck. If you’re trading in your current truck, enter the amount the buyer is offering for it — or what you think you can get for it. If you still owe money on it, subtract the remaining loan balance from the trade-in value and enter the difference. Leave this blank if you’re not planning to trade anything in.
Down payment. Many lenders require a down payment of around 10% to 20% of the truck’s purchase price. But since you’re trying to figure out how much you can afford, you can leave this blank or enter a dollar amount you’d be able to reasonably afford as a down payment.
Annual percentage rate (APR). This represents the total cost of borrowing the lender’s money to pay for your truck. It includes the interest rate plus any loan fees your lender might charge. While lender websites may list a starting interest rate, you’ll likely have to prequalify online or submit a formal application to get a more accurate rate. Equipment financing APRs commonly range from 4% to 45%, depending on your qualifications, the lender and the equipment you're purchasing.
Loan term (months). Here’s where you’ll punch in the number of months your loan will last. Loan terms often range from 12 to 60 months for commercial truck loans. If you’re not sure, you can use a shorter length for a more conservative estimate.
Calculate your truck affordability results
Once you hit “calculate,” you’ll get an estimated truck price you may be able to afford to buy. Use this number as a guide when shopping for your next commercial vehicle.
You’ll also see a breakdown of your estimated financing costs if you were to get a loan using the full estimated truck price:
Amount financed. This is the total amount you’d borrow from your lender if you bought a commercial truck using the full estimated price above. It includes the truck’s purchase price and any sales tax, minus your down payment and the trade-in value of any trucks you’re replacing.
Total payments. This is the total amount you’d pay your lender over the loan’s lifespan.
Total interest paid. This is the total amount you’d pay in interest and fees for the loan. You can save on interest by paying your loan off early (just watch out for prepayment penalties).
Amortization schedule. This shows the breakdown of how each monthly payment is split between principal and interest, and how your balance changes over time.
