Tractor Financing: What You Need To Know
We all know that you’ve got to spend money to make money, but that doesn’t mean you have to spend all of it. Financing, or getting a loan, is an excellent way to make your dollar stretch farther, and it lets you get the equipment you need sooner. To help you find the right deals and give you advice, we here at J5 Tractors have put together this basic guide to tractor financing. We also offer financing options ourselves so that you can get the products you need without a middle-man or worrying about heavy upfront costs.
If you have more questions or would like to see our stock of tractor and farm equipment, stop by one of our stores in Conroe, Navasota, Buna, or Normangee, Texas. Our expert staff can walk you through your options to make sure you leave with exactly what you need.
Step One - Budget
Any good shopping experience should begin with a budget, especially for work items. You’ll want to establish a number that’s realistic both for your circumstances and for the market. Research tractor costs and check the rates and terms of any loans you might be looking into to make sure you get the right option. Also make sure to account for future costs like maintenance, fuel, repairs, and any other necessary expenses, rather than only looking at upfront costs.
Next consider how high a monthly payment you’re willing and able to spend, keeping in mind your income, spending habits, fixed expenses, and emergency funds. There are a number of online calculators that can walk you through your preferred monthly payments to help you find the right tractor at the right prices.
Choosing A Loan
Financing a tractor means paying a fixed monthly payment over the course of the next few years. Tenure and interest rates between different loans and lenders will vary widely and depend on the lender, loan amount, type of loan, and your own income and credit score.
A secured loan can be convenient, with long repayment terms and lower overall rates. However, they use your machine as collateral, which means that defaulting on your loan gives the lender ownership rights on your tractor. But qualifying for an unsecured loan can be a hassle and they tend to have higher rates, so a secure loan might be right for you. An unsecured loan doesn’t have collateral, which means their payment terms are shorter with higher rates.
Your local bank will have financial experts who can help you learn more about the different types of loans available to you. Make sure to ask them about loan application processes, time frames, standard terms, and repayment schedules. We also have knowledgeable team members at J5 Tractors, so don’t hesitate to call on us for more information!
Lending Options
There are a number of sources you can get loans from for your tractor, from banks to credit unions to lending institutions. Whether or not you use a particular bank for your personal or business financing needs, they can still help you obtain a personal loan. However, choosing a lender you already bank with tends to provide lower interest rates.
Rates vary depending on your credit and the amount of money in the loan itself. You can also turn to a nonprofit lender, like a credit union, to finance your tractor. Credit unions tend to give you a lower rate with a higher total loan amount, making them an excellent option.
Some dealerships also have their own financing department, like us here at J5 Tractors. We can help you get the cash necessary to purchase the tractor you need. Our professional staff will assist you in finding exactly the right vehicle and work with you to determine the best financing option for you.
If you found this guide helpful but still have questions, feel free to call us or stop by. At J5 Tractors, it’s our goal to make the financing process as simple and painless as possible so you get what you need at a fair price. Stop by our dealerships in Conroe, Navasota, Buna, or Normangee, Texas, and get your tractor financed today!