Financing for truckers and trucking companies falls into four main categories: equipment loans and leases to buy trucks and trailers, invoice factoring to get paid on freight bills immediately, working capital and revenue-based funding for fuel and payroll, and lines of credit for ongoing cash flow. Which one fits depends on what you need the money for — a rig purchase is a long-term equipment loan, while covering fuel while you wait 30 to 90 days for a broker to pay is usually factoring or a short-term advance.
Trucking is a cash-flow business with expensive equipment and slow-paying customers, so most carriers use more than one product at once. Owner-operators and small fleets can qualify for many of these options with a personal FICO score of 500 and up when the funding is based on revenue and deposits rather than credit alone, with funding amounts starting around $10,000 and money often available the same day to 48 hours.
Key takeaways
- Trucking financing splits into four core types: equipment loans/leases, freight factoring, working capital/revenue-based funding, and lines of credit.
- Freight factoring advances roughly 90%–97% of an invoice's value within about 24 hours instead of waiting 30–90 days for the broker to pay.
- Revenue-based funding starts around $10,000 and can fund the same day to 48 hours, with FICO 500+ accepted based on bank deposits.
- Equipment loans use the truck or trailer as collateral, with terms of 3–7 years and down payments typically 0%–20%.
- Recourse factoring fees run about 1%–3% per invoice; non-recourse runs about 3%–5% but covers broker bankruptcy.
- Revenue-based products use a factor rate (e.g., 1.25 on $30,000 = $37,500 repaid), not an APR.
- Most carriers can qualify with 3–6 months of bank statements, an active MC/DOT number, and proof of insurance.
- Factoring approval is based on your customers' credit, making it accessible for newer carriers with low personal credit.
- A reverse consolidation lowers the daily/weekly payment by extending the term — freeing cash flow rather than eliminating the balance.
- SBA loans offer the lowest cost and longest terms but require stronger credit, more time in business, and slower funding.
The main financing options for trucking businesses
Trucking companies typically choose from several funding types depending on the need. Equipment and cash-flow needs are very different, so it helps to match the product to the purpose:
- Equipment loans and leases — Buy or lease trucks, trailers, and reefers. The equipment itself serves as collateral, so approval leans on the asset and your revenue. Terms usually run 3 to 7 years.
- Invoice (freight) factoring — Sell your unpaid freight invoices to a factor and get roughly 90% to 97% of the value within 24 hours instead of waiting on the broker or shipper.
- Working capital / revenue-based funding — A lump sum repaid from future deposits, used for fuel, repairs, insurance down payments, and payroll. Fast and credit-flexible, but priced with a factor rate.
- Business line of credit — A revolving limit you draw on as needed and only pay interest on what you use. Good for seasonal or unpredictable expenses.
- SBA loans — Lower cost and longer terms for established carriers with stronger credit and time in business, but slower to fund.
Equipment financing: buying trucks and trailers
Equipment financing is the backbone of most trucking operations. Because the truck or trailer secures the loan, lenders can approve owners who wouldn't qualify for an unsecured loan, and rates are generally lower than short-term cash-flow products. Expect to put down 0% to 20% depending on credit, the age of the equipment, and whether you're an established fleet or a first-time owner-operator.
New equipment usually earns the best rates and longest terms; used trucks with high mileage carry higher rates and shorter terms because they depreciate faster. A lease can lower the monthly payment and sometimes includes maintenance, while a loan builds equity you own outright at the end.
| Feature | Equipment Loan | Equipment Lease |
|---|---|---|
| Ownership | You own it at payoff | Lender owns it; buyout option at end |
| Down payment | Often 10%–20% | Often $0–first/last payment |
| Typical term | 3–7 years | 2–5 years |
| Monthly payment | Higher | Lower |
| Best for | Long-haul keepers you'll run for years | Cycling equipment or preserving cash |
Freight factoring: getting paid without the wait
Freight factoring solves the single biggest cash-flow problem in trucking: brokers and shippers often pay in 30, 60, or 90 days, but fuel and drivers need paying now. With factoring, you deliver the load, submit the invoice to a factoring company, and receive most of the money within about 24 hours. The factor collects from the broker and pays you the rest, minus its fee.
Factoring is based on your customers' creditworthiness, not yours, so it's one of the most accessible options for newer carriers and those with lower personal credit. There are two common structures:
- Recourse factoring — Lower fees, but you're responsible if the broker never pays. Fees often run about 1% to 3% per invoice.
- Non-recourse factoring — The factor absorbs the loss if the broker goes bankrupt. Higher fees, typically around 3% to 5%.
Many factors also offer fuel cards and same-day funding, which is why a large share of owner-operators use factoring as their day-to-day cash engine.
Working capital and revenue-based funding for cash flow
When you need cash for a repair, an insurance down payment, a fuel run, or to bridge a slow month, working capital and revenue-based funding are the fastest options. Instead of relying on a high credit score, these products approve based on your business bank deposits and revenue history — usually your last 3 to 6 months of statements. Owners with FICO scores as low as 500 are frequently approved when deposits are steady, and funding amounts start around $10,000, often landing in the account the same day to 48 hours.
Revenue-based products are priced with a factor rate rather than an APR. A factor rate of 1.25 on $30,000 means you repay $37,500 total ($30,000 × 1.25). Repayment comes out of future revenue on a daily or weekly schedule. This is fast and flexible, but the effective cost is higher than an equipment loan, so it's best for short-term needs you'll repay quickly — not for buying a truck.
| Product | Typical amount | Speed | Min. FICO | Cost basis |
|---|---|---|---|---|
| Equipment loan | $25,000+ | 2–7 days | 600+ | APR (interest) |
| Freight factoring | Advance on invoices | ~24 hours | Customer credit | 1%–5% fee per invoice |
| Revenue-based funding | $10,000+ | Same day–48 hrs | 500+ | Factor rate (1.1–1.5) |
| Line of credit | $10,000–$250,000 | 1–3 days | 600+ | APR on drawn amount |
How to qualify and what documents you'll need
Qualifying is easier than many owner-operators expect, especially for revenue-based and factoring products. Lenders weigh three things: how long you've been in business, your monthly revenue and bank deposits, and your credit — though credit matters far less for factoring and revenue-based funding. Most carriers can qualify with 3 to 6 months of operating history, though a full year strengthens any application.
Common requirements include:
- 3 to 6 months of business bank statements showing consistent deposits
- A valid MC number, DOT number, and active operating authority
- Proof of insurance and equipment titles (for equipment financing)
- Recent invoices and a broker/shipper list (for factoring)
- Driver's license and business formation documents
Tips to improve approval and pricing: keep personal and business banking separate, avoid overdrafts and negative days in your statements, and maintain steady deposits. A larger down payment or newer equipment lowers your rate on equipment loans.
Refinancing and reducing your daily payments
If a carrier took on a short-term advance during a slow stretch and the daily or weekly payment is now squeezing cash flow, refinancing options can lower that payment and free up working capital. Rather than eliminating the obligation, a reverse consolidation restructures how much leaves your account each day — combining multiple frequent withdrawals into a single, smaller payment stretched over a longer period so you keep more fuel and payroll money in the bank each week.
This can be the difference between staying on the road and parking the truck during a downturn. The trade-off is that extending the term generally increases the total amount paid over time, so it's a cash-flow tool, not a cost-saver. Carriers with improved credit or stronger revenue since their original funding may also qualify to replace a high-cost advance with a lower-cost line of credit or term loan.
Frequently asked questions
Can I get trucking financing with bad credit?
Yes. Revenue-based funding and freight factoring are the most accessible options for lower credit. Revenue-based products often approve owners with a FICO of 500 and up because the decision is based on your bank deposits and revenue, not just your score. Factoring is based on your customers' credit, so your personal score may not matter at all.
How fast can I get funded?
It depends on the product. Freight factoring typically funds within about 24 hours of submitting an invoice. Revenue-based working capital can hit your account the same day to 48 hours. Equipment loans and SBA loans take longer — usually several days to a few weeks — because of asset verification and underwriting.
What's the difference between a factor rate and an APR?
An APR expresses cost as an annual interest percentage and is common on equipment loans and lines of credit. A factor rate is a simple multiplier used on revenue-based funding: a 1.25 factor rate on $30,000 means you repay $37,500 total, regardless of how fast you pay it off. Factor rates usually translate to a higher effective cost, so they suit short-term needs.
How much can a trucking company borrow?
Revenue-based funding typically starts around $10,000 and scales with your monthly deposits. Equipment loans run from about $25,000 into the hundreds of thousands depending on the rig. Lines of credit commonly range from $10,000 to $250,000. Your revenue and time in business are the biggest factors in the amount you'll qualify for.
Should I use a loan or a lease to buy a truck?
Choose a loan if you plan to keep the truck for years and want to own it outright — you build equity and usually pay less over the life of the equipment. Choose a lease if you want lower monthly payments, plan to cycle equipment every few years, or want to preserve cash. Leases often have low or no down payment and a buyout option at the end.
Do I need an MC and DOT number to get financing?
For most trucking-specific products, yes. Equipment lenders and factoring companies will ask for your MC number, DOT number, and active operating authority, plus proof of insurance. Newer authorities can still qualify — many revenue-based and factoring programs accept carriers with just 3 to 6 months of operating history.
Can factoring and a working-capital advance be used together?
Yes, and many carriers do. Factoring handles day-to-day cash flow by advancing money on invoices, while a working-capital advance or line of credit covers larger one-time needs like a major repair or an insurance down payment. Just confirm the terms don't conflict, since some factoring agreements have exclusivity or lien requirements.
My daily advance payment is too high — what can I do?
A reverse consolidation can lower the amount withdrawn from your account each day by combining several frequent payments into one smaller payment over a longer term, freeing up cash flow for fuel and payroll. It doesn't erase the obligation and typically raises the total paid over time, but it can keep your truck running during a slow period. Improved credit or revenue may also let you refinance into a lower-cost product.
