# Dam Banks!!



## cold_and_tired

Walked into my local branch of a bank that I have been with for YEARS. I told them that I need a loan to purchase a machine (skid steer) and they told me that my business has no credit and they could not give me a loan.

Duh. I started this business four years ago with my own money. I have ZERO business debt right now.

I asked them what was the best way to build business credit. They told me to get a credit card in the company name. Ok, I can handle that. I fill out the application and received a call back a few days later saying that I had been declined because my business had no credit.

Are you freaking kidding me?

What is the next best way to go about getting the money for a machine? I would really rather not use my personal credit for a purchase.


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## newhere

cold_and_tired;1154994 said:


> I would really rather not use my personal credit for a purchase.


your going to have to, get use to it.

even if they did give your biz a loan i bet will make you co-sign it holding you just as responsible.


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## rofoth6

It's a catch 22. Got to have credit to get credit.But nobody will give you credit to get credit.:realmad:


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## LoneCowboy

banks are no good
I went in two years ago to get a loan for my dump truck (just to save the capital)
they said "no can do"
I said, I'm going to write a check for it then, off the money that's sitting in my business account in your bank.
Nooo, too great of a risk.


anyway, I've found tractor/equipment dealers have great financing rates and easy to finance. As long as you put down 20% or so, not a big deal, rates in the 5 to 7% range.
work with the dealer.
I've got a new 15' batwing coming in the spring, took like 30 seconds to do the financing.

Forget the banks, they don't want my money, they don't get it then.

and yeah, every time I get a job from a bank (mostly foreclosures), they pay a good 20% more than regular people.


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## blowerman

newhere;1155003 said:


> your going to have to, get use to it.
> 
> even if they did give your biz a loan i bet they will make you co-sign it holding you just as responsible.


In todays business environment, you as the owner will almost always be providing the guarantee for the loan. I guess I'll bet also.

Try working with a dealer on purchasing a machine. They can help you get financing on used machines as well.
If you are struggling to get credit, they (you) could rent a machine for a period of 3-6 months, as you build up equity it's easier and the finance companies are more willing to convert the machine to a purchase.


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## EGLC

had the same issue when I was 19 buying a 11k truck putting down 50% and banks told me to eff off. So I bought it cash, went down to my John Deere dealer in spring and bought a 13k mower with ZERO down and I took delivery 2 days later!

** btw I ALSO offered the bank 50% down PLUS the remaining 50% in a CD that I could NOT touch until loan was paid off and they STILL DENIED ME!! Like are you fuggin kidding me?!

like rofoth6 said you need credit to get credit.But nobody will give you credit to get credit....so for now I'm stuck paying cash. 

I also just found out the John Deere credit does NOT report to the credit unions so my $395 monthly payment that i've been sending in $495 on to pay off quicker has no been helping my credit score at ALL :realmad:


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## WilliamOak

Before I got my dmax I paid off the remaining balance of my old truck a year early, then went to them for a loan on a 13k truck and got DENIED w/ 50% down.. The fact that I made every payment on time and paid it off early held no weight...


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## show-n-go

WilliamOak;1155446 said:


> Before I got my dmax I paid off the remaining balance of my old truck a year early, then went to them for a loan on a 13k truck and got DENIED w/ 50% down.. The fact that I made every payment on time and paid it off early held no weight...


The reason the bank didn't care was they want to see how you pay over a long length of time, not how fast you can pay off your loan. The earlier you pay it off the less they make. Good for you=bad for them.

Once you have 36-48 payments made thats when you have some depth to your credit, and thats what they are looking for.

For the business loans they almost always require a cosigner just because they have been burned to many times doing them without, unless your company has credit on the dun and bradstreet report your going to need to cosign the loan. By cosigning you will help your business build credit so that one day you wont need to sign.
I agree banks are picky with limited credit but they are lending today based on history of there books.


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## forestfireguy

Dealers will find you financing, just don't let them rape you on the rate. Any dealer, equipment/car or anything else, makes money on financing. There's most often a buy rate, the rate the financial institution actually approved you for and the sell rate, which is what(the rate) the dealer trys to get you to sign.

Thats if there's no advertised "program" going on. I know New Holland has been running a winter thing for the last few years, where you only pay during winter months, not sure if this is a lease or a finance plan. 

If you can't secure the credit is leasing an option? Or possibly purchasing used without a note?


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## Brian Young

cold_and_tired;1154994 said:


> Walked into my local branch of a bank that I have been with for YEARS. I told them that I need a loan to purchase a machine (skid steer) and they told me that my business has no credit and they could not give me a loan.
> 
> Duh. I started this business four years ago with my own money. I have ZERO business debt right now.
> 
> I asked them what was the best way to build business credit. They told me to get a credit card in the company name. Ok, I can handle that. I fill out the application and received a call back a few days later saying that I had been declined because my business had no credit.
> 
> Are you freaking kidding me?
> 
> What is the next best way to go about getting the money for a machine? I would really rather not use my personal credit for a purchase.


We did a lease to own deal. The rates were better than a bank or just as low, the payments are reasonable and its only a 36 month lease with a dollar bye out the last month. I can PM you the guys number, they are out of Pittsburgh. I ran into kind of the same thing. We needed a wheel loader and we had signed contracts with guaranteed income and they still said no even with us having great credit scores. It was a simple and fast process, we heard back in 2 days and that was only because the guy was out of his office for a day.


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## JCByrd24

EGLC;1155426 said:


> I also just found out the John Deere credit does NOT report to the credit unions so my $395 monthly payment that i've been sending in $495 on to pay off quicker has no been helping my credit score at ALL :realmad:


I don't think paying extra on a loan will help your credit score, but making your regular loan payments should as long as you don't have too many loans or whatever. Are you saying your Deer account doesn't show up at all?


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## Brian Young

Its more than a good credit score. It's also debt to income ratio, revolving money, a consistent healthy balance in the account and it seems if your missing just one of these your S.O.L.


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## T.French

I wanted a line of credit from our bank,They wanted to put a lein on all my equipment I own free and clear.Said no way.Wanted a truck loan they told me go pick it out.Wanted 150k for real estate purchase no problem.But the bottom line is whether business or personal your name is still an the line.


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## magnum1

cold_and_tired;1154994 said:


> Walked into my local branch of a bank that I have been with for YEARS. I told them that I need a loan to purchase a machine (skid steer) and they told me that my business has no credit and they could not give me a loan.
> 
> Duh. I started this business four years ago with my own money. I have ZERO business debt right now.
> 
> I asked them what was the best way to build business credit. They told me to get a credit card in the company name. Ok, I can handle that. I fill out the application and received a call back a few days later saying that I had been declined because my business had no credit.
> 
> Are you freaking kidding me?
> 
> What is the next best way to go about getting the money for a machine? I would really rather not use my personal credit for a purchase.


Have you tried a credit union, I also requested a credit line from my bank they declined my request for a buis. loan ( been in buis since 1989 with a high credit rating ) but informed me I could open a pesonnal line of credit.
I spoke with one of the credit union reps I deal with she recommended a credit card
through them with a low single didget fixed rate and a high credit allowance. Maybe that could be a solution.


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## norrod

Start up credit is one step at a time.
On my startup, I purchased a skid steer from BobCat, and they were more then happy to finance. I then purchased a used Dump druck from a truck dealer. I had a sizable down, so they were happy to finance. I had a local mechanic that did all my inspections, and some of my repairs. He was happy to let me use him as a business credit reference when I applied for a biz account with United Rentals. This lead to a credit card for the Company, and other lines of credit.

Keep in mind I was not really interested in revolving accounts, but it's nice to know I could call United Rental for an excavator or dozer drop, and not worry about paying the bill till next mont. while establishing credit.


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## cold_and_tired

norrod;1158489 said:


> Start up credit is one step at a time.
> On my startup, I purchased a skid steer from BobCat, and they were more then happy to finance. I then purchased a used Dump druck from a truck dealer. I had a sizable down, so they were happy to finance. I had a local mechanic that did all my inspections, and some of my repairs. He was happy to let me use him as a business credit reference when I applied for a biz account with United Rentals. This lead to a credit card for the Company, and other lines of credit.
> 
> Keep in mind I was not really interested in revolving accounts, but it's nice to know I could call United Rental for an excavator or dozer drop, and not worry about paying the bill till next mont. while establishing credit.


I am just the opposite. I have multiple rental accounts and got those quite easily but cant seem to find the financing to purchase a machine.


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## magnum1

cold_and_tired;1158503 said:


> I am just the opposite. I have multiple rental accounts and got those quite easily but cant seem to find the financing to purchase a machine.


Try Agricredit Acceptance LLC
Email me for the #


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## EGLC

JCByrd24;1155892 said:


> I don't think paying extra on a loan will help your credit score, but making your regular loan payments should as long as you don't have too many loans or whatever. *Are you saying your Deer account doesn't show up at all?*


YES! And JD reps told me that it will ONLY show if I default!! That's such a load of shyt! If they don't report when I do make payments, then I feel they should NOT be allowed to report if I was to not make payments!!! :realmad:


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## coldcoffee

Any loan I've ever had was personal. I grew tired of the games and hidden fees that banks and finance companies like to play, including sometimes the add on of life insurance, points, etc. I have my own private investors now, which makes for fast cut-n-dry deals. Smaller deals they might just do cash out of pocket, larger ones they use their secured credit lines. It works for them because they get a better return than cd's and the like. It works for me because I know clearly what my deal is w/ no surprises, and I can focus on what I do best. I can also pay off early w/ no prepayment penalties. Their are plenty of people out there w/ money, that want to put it to work. Otherwise, the dealer or someone who specializes in small loans is probably your best option.


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## 01lariat

You need to have a great credit score for them to even look at you. The bank won't float me a gum ball. Student aid however, I got no problem. So I guess that is my ticket back to having credit.


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## ryde307

EGLC;1158651 said:


> YES! And JD reps told me that it will ONLY show if I default!! That's such a load of shyt! If they don't report when I do make payments, then I feel they should NOT be allowed to report if I was to not make payments!!! :realmad:


We went in to buy some newtrucks this year. Dealer came back says you have no business credit. Well thats odd we just paid off a 3 year 50,000 loan from the bank a few other small loans and so on. Turns out alot of places dont report your credit because it costs them money. But thye will gladly report it for you if you dont pay on time.:realmad:


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## AG09

EGLC;1158651 said:


> YES! And JD reps told me that it will ONLY show if I default!! That's such a load of shyt! If they don't report when I do make payments, then I feel they should NOT be allowed to report if I was to not make payments!!! :realmad:


Jared pull your credit report to see if JD reports it or not and to see what is reported exactly. I know Sheffield does.

Any guys looking to purchase equipment look into Sheffield Financial. They specialize in this industry and I believe they are more flexible with lending since this industry is where they make their money from.


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## EGLC

AG09;1159879 said:


> Jared pull your credit report to see if JD reports it or not and to see what is reported exactly. I know Sheffield does.
> 
> Any guys looking to purchase equipment look into Sheffield Financial. They specialize in this industry and I believe they are more flexible with lending since this industry is where they make their money from.


They don't. I got my report last month. They said they can write a letter of recommendation, like anyone gives a shyt about that!:yow!:


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## AG09

EGLC;1160001 said:


> They don't. I got my report last month. They said they can write a letter of recommendation, like anyone gives a shyt about that!:yow!:


Damn thats ********. Did they pull your credit to approve you?


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## cosgo

You are leaving some important info out. You said youve been in business for 4 years. did your bank ask you for your last 4 tax fillings? The company doesnt neccessarily have to show a profit, but does have to show growth. did you provide them with letters from business's that extend you credit now (do you do advertising, buy bulk fuel, have an account at NAPA, stuff like that) did you use a bank that is SBA approved? this can be a huge plus to you, if you havent. certainly, you will be asked to gauranty the loan personally if the company defaults, so be prepared to do so. if you have 4 legit business years of history, and filed taxes properly, and show growth or profit, there is no reason you should be denied. (unless of course for example your business net worth is like 10k and your asking for a million dollar loan!!) im exagerating obviously, but things do need to be in line to get a loan.


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## tpiper

same problem here! i have known my banker and his father (president/ceo of bank) since i was 3 years old and i mow for both of them plus bank and repos but if i need something they always say my debt to income ratio is to high. i have always paid them on time and always will. i have decided in the spring i am going to tell them that my income to debt is too low and i am raising their rates. lol
look for another bank somebody out there will take your money.


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## qualitycut

yes its tough getting a loan I got a 50,000 loan for my truck but wanted to get a line of credit from my bank they said no even with a co-signer with 250,000+ salary and 788 credit score. Well I solved the problem buy switching to a different bank and they were happy to get me one. All the people who got loans and quit paying screwed it up for the rest of us. Then the government bailed the banks so they would lend money but I sure dont see the results.


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## plowin-fire

Just a thought here... Been a loyal Dave Ramsey listener and went to his classes as well. Whats wrong with just paying cash? All the equipment I own I paid cash for. If I dont have enough for it, I cant buy it. Keep saving til you do. Then I dont have to pay interest and fees and can use that money to purchase more equipment. I cant get a loan or a credit card either, nor do I want one cause I have a credit score of ZERO from paying cash. Not trying to bash anyone, this is just the way that I operate my business and has worked very well for me.


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## coldcoffee

Plowin-fire, If more people would use that logic and stop buying crap they don't need, they would be amazed at the wealth they could build. More importantly, the independence and self confidence they would gain as well. I would also add, if you want to get even w/ the banksters, try investing in some metal (silver is my favorite for too many reasons to write about). They don't want you to know what real money is, how badly the true values have been manipulated, and how they are loosing their leverage. Watch the markets very carefully in 2011, the games are still in an early stage...within the next few years people will be saying woulda, coulda, shoulda...as they are doing now. Oh yea, the right metals should also work quite nicely for leverage, just learn how to follow trends and know when to buy...and sell. Fiat currency...return to sender! Just look what China has been doing under the radar, as well as others...


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## Lugnut

I have financed with Sheffield and will again this spring for another mower. Everything I have with the exception of one of my zero turns and the one I will add this spring have been paid for with cash. I tried to get a 10,000 loan for the F550 i bought this year and got denied for it at the bank. Loan officer said sorry you wont be able to get the truck...I kinda looked at him since he had my accounts up on his computer and said no, it looks like ill just pay cash for it. Seems like they think everyone who looks for a loan is just looking for one because they don't have the money for their purchase, not because they are trying to boost their credit rating or minimize the amount of money spent at once.


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## JCResources

Prosper is a website where lenders bid on the borrower's loan. I borrowed some money there for a skid steer attachment, great experience. Your money goes to individual investors not a bank, that's what I liked about it. Unsecured, so the rates are a little higher, only up to $25,000.http://www.prosper.com/

http://www.facebook.com/pages/JC-Resources/256225321177?ref=ts


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## kashman

EGLC;1158651 said:


> YES! And JD reps told me that it will ONLY show if I default!! That's such a load of shyt! If they don't report when I do make payments, then I feel they should NOT be allowed to report if I was to not make payments!!! :realmad:


banks dont give 2 shyts about good credit just bad . if your looking 2 get 10. from a bank you better show 100 income


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## kashman

plowin-fire;1234726 said:


> Just a thought here... Been a loyal Dave Ramsey listener and went to his classes as well. Whats wrong with just paying cash? All the equipment I own I paid cash for. If I dont have enough for it, I cant buy it. Keep saving til you do. Then I dont have to pay interest and fees and can use that money to purchase more equipment. I cant get a loan or a credit card either, nor do I want one cause I have a credit score of ZERO from paying cash. Not trying to bash anyone, this is just the way that I operate my business and has worked very well for me.


thats how i do it


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## EGLC

plowin-fire;1234726 said:


> Just a thought here... Been a loyal Dave Ramsey listener and went to his classes as well. Whats wrong with just paying cash? All the equipment I own I paid cash for. If I dont have enough for it, I cant buy it. Keep saving til you do. Then I dont have to pay interest and fees and can use that money to purchase more equipment. I cant get a loan or a credit card either, nor do I want one cause I have a credit score of ZERO from paying cash. Not trying to bash anyone, this is just the way that I operate my business and has worked very well for me.


If you want to grow and grow with some speed you won't have enough cash unless you're a Kennedy. Also by using loans you can build credit while conserving cash. You have to learn how to spread out your money in the absolute best possible way to yield the best return. I'd rather have 30k into two trucks with a 30k loan then have on 30k truck paid for cash. Two trucks should easily double roi plowing and even doing landscape work throughout the year.

Now if you're ok running your business solo or maybe just 1-2 employees (nothing wrong with this) and don't mind taking baby steps sure you can buy all cash.

I personally took out a $5k loan on a truck this fall from a friend and payed him back in 3 months. I payed a lot in interest but it was worth it to me.


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## plowin-fire

I can see you point on borrowing to purchase more equipment to pick up more account to earn more monthy income. It also adds some risk as well. What if it only snows 10" the whole season? That wouldnt pay the payments. By paying cash you dont have the risk involved. It may be slower, but for me thats just fine. The tortoise always wins the race everytime I read the book.


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## RLM

When I started I grew out-of pocket (cash), as you get larger you need to borrow money for growth, wheel loaders & new trucks that are from 40 K to 85K. Often it makes more sence as well, when intrest rates ares anywhere from 0% to 4.9 (rates I have on my loans), even if I had the cash on hand to pay them off, I wouldnt. The hard part I see is the life cycle on the large equipment is about 20 years, the payment terms are 5, so the first 5 years are the rough ones. I have always had to sign personal guarantees on the loans as well when in the business name. Never been denied though.


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## grandview

This has been brought up before on getting loans vs paying cash. Banks don't care if you pay cash it means nothing to them. They want to see repayment history. As for saving up for a piece of equipment cash is nice, but if it takes you 3,4,5 years to save up how much did that piece of equipment go up while your saving for it? You could of maybe got a loan used it and made money and paid back the loan early and build up a credit line.


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## elite1msmith

I agree with the above statement, however. A...the machine ownership lag time, only takes places once...meaning, you save , you buy the first one, and while owning the first one, you save for the second.......so your only out the first few years it takes to buy each new peace....replacing them is the same. B. The machine does go up, but when you factor interest, not only on the first machine, but the second replacement units....it evens out quickly C. Having cash saved in hand, you can work better deals, and reselling is a heck of a lot easier if you end up needing to sell before the loan is up. D. Slow economy it's nice to have less stress, own it and sleep good even if work is slow


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## ff610

I've lived on the philosophy for 20 years that I don't buy equipment if I can't afford to pay cash for it. Now with that said, I have occasionally bought a truck under my personal credit, but always paid it off quickly. The frustrating problem I've dealt with is now I've extended my personal credit for my business, so when my wife decided she wants a new house or something it comes into play. Again, I agree that the best route is to pay only as you can afford it, that way slow winters cause less stress. On the flip side to that, substantial growth when you talk about more costly expenses such as larger equipment, buildings etc, can't be paid with cash in most cases. I've been at credit unions for years and they would never do anything. I recently went to a local bank last year that also deals with farmers etc. They understood. I got a loan for a brand new skid steer last year with only providing a copy of my LLC paperwork. Since then I've had absolutely no problems getting business loans. Heck, I even got a loan from Ford Credit for my new truck. Now just so everyone understands how it typically works, I signed as personal guarantee on all these loans, meaning as the owner I guarantee funds. It does not show up on my debt to income ratio for me personally, but I do stand behind the loans. Once I have 18 months of payment history with my bank, they told me that can be dropped. I've been told that once you have your foot in the door with Ford credit, that only the first loan needs to be personally guaranteed. As long as you make payments on time! The main reason I even bothered with building business credit after all these years is I'm building a new shop this year. I've already been told by my bank they will finance me. So there are ways to do it, you just have to find the right banker, and ask a lot of questions.


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## grandview

ff610,see you learned a good lesson about credit and financing your business with your personal money.Of course you are a DBA,LLC or a corp to keep your business and personal separate.


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## ff610

grandview;1241401 said:


> ff610,see you learned a good lesson about credit and financing your business with your personal money.Of course you are a DBA,LLC or a corp to keep your business and personal separate.


Roger that! For years, it all blended together, including the risk and liability. At some point in time it had to change..........


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