# Business Loan for Truck/Trailer



## skillman (Sep 23, 2011)

Spencer said:


> I've got a lot of tools accumulated but my truck isn't up to par for full time work and pulling a trailer. I don't have the funds at this time to pay cash for truck and trailer. I'm thinking I'd like to borrow about 15-20k between the two and was wondering what the best route would be. Would you recommend getting separate loans for the truck and trailer or would the bank do something like a lump sum "business loan." To add, I'm looking for a pre-2003, 7.3 diesel and either a 7x14 or 7x16 trailer. Like I said, I've got more tools than most contractors around here to get going but unfortunately my house remodel has drained my cash and its time to strike out on my own. Thanks for the help as always.


 Forget that . Load and unload tools out of your truck everyday . Or leave on jobsite . When you have some coin saved up buy a cheap van .


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## Jaws (Dec 20, 2010)

You got some operating money to get started with?


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## Jaws (Dec 20, 2010)

skillman said:


> Forget that . Load and unload tools out of your truck everyday . Or leave on jobsite . When you have some coin saved up buy a cheap van .


Other than leaving tools anywhere, this is solid advice. :jester::whistling


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## skillman (Sep 23, 2011)

Jaws said:


> Other than leaving tools anywhere, this is solid advice.


 I did it for years . It comes down to it you don't need much in tools to be a carpenter space wise . Learn to live without .


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## The Coastal Craftsman (Jun 29, 2009)

skillman said:


> Forget that . Load and unload tools out of your truck everyday . Or leave on jobsite . When you have some coin saved up buy a cheap van .


The problem with that is some people have way more tools than can fit into a truck.


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## Jaws (Dec 20, 2010)

I thought there was a bunch of thieves in Ny? 

I always pack my chit up every day. 


You are right about space. I had (still have, lead drives it) a single cab 3/4 gas with no bells and whistles, a big cross body box, two side boxes and a headache rack. Could outfit for just about anything in it.

Trailers are nice though. Always run out of room in those too. Lol


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## onmywayup (Aug 18, 2012)

Until recently, I've driven piece of crap small cargo vans for ten years. I just bought a new trailer and a used truck because I opened up Quickbooks and realized how much money I put into repairs on my last van this past year. 

Yes, I paid cash for it and had no payments, but I spent nearly more than the payments I'll be making this year on my new rig in repairs on the old one. And I gotta say, I simply feel more legitimate driving this truck and trailer around. First impressions are absolutely crucial, and people see this rig before I even get a chance to shake their hand and change their minds 

Seriously though, it's not like having the truck and trailer make me professional; that comes from work ethic and diligence. But I can't tell you how relieving it is to know that when we drive to a job 3 1/2 hours away on Tuesday, I'm very likely to make it there in one piece, and I have a remote starter to boot!

The payments on that loan keep me hungry for business. I'm up at 5am on a Saturday to make sure we stay on the edge. Heavy lies the head that wears the crown? Not so much........just want to win this game so bad that it wakes me up and gets my azz out of bed.

If you've got the work to get started, then start chasing the dream man. Although I predict that paying that loan off in a year (especially your first year) is going to be harder than you imagine.


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## Spencer (Jul 6, 2005)

skillman said:


> Forget that . Load and unload tools out of your truck everyday . Or leave on jobsite . When you have some coin saved up buy a cheap van .


The only thing I can imagine that I would hate worse that waiting another year to start up would be unloading and loading tools everyday. If I can't offer my clients something more professional/efficient than that I may as well not bother because the guys who do that are a dime a dozen around here. I understand the point, but I'm trying to set myself apart. There is no way I could haul all the tools I need to do my work on my truck alone. I would constantly not have the tools and supplies I need.


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## Spencer (Jul 6, 2005)

skillman said:


> I did it for years . It comes down to it you don't need much in tools to be a carpenter space wise . Learn to live without .


I'm just thinking how I would handle this. 

Trim nail guns.
Framing Guns.
Pasloade Guns.
Hand Tools.
Laser.
Miter Saw/Stand
Table Saw/Stand
Compressors
Hoses
Cords
Circ Saws
Track Saw
Sanders (palm,orbital,belt)
Screws
Nails
Collated Nails
Supplies (rags, towels, sandpaper, etc)
Caulk/Guns
Saw Horses
Trash Cans
Ladders
Someitme aluminum brake.
Specialty Tools-Drywall, Electric, Plumbing

Thats just off the top of my head. I'll update my signature. I'm remodeling, not working as a trim sub. I've played the load unload game with other employers. It costs everybody time, money, stress, headaches, and lesser quality.

I want to be able to spend my mental energy on the job and business not trying to think of all the crap I need every morning.


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## BlueRidgeGreen (Apr 21, 2012)

BCConstruction said:


> The problem with that is some people have way more tools than can fit into a truck.


I have fifty times the tools that will fit in my truck.

But I rarely need them all in one single day. 

If I set up "shop" onsite, I just load over a couple days.

Unless I could drag a double-wide behind my Tacoma, I would always be missing.... something. Plus, trailers become an inefficient mess with 4-5 guys grabbing and (not) returning things to their exact spot in the rolling closet. 

Now, if everybody was as tidy as you in their trailer habits:thumbsup:.....nah, still won't get one.


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## BlueRidgeGreen (Apr 21, 2012)

Spencer said:


> I'm just thinking how I would handle this.
> 
> Trim nail guns.
> Framing Guns.
> ...


I respectfully disagree.

Careful planning and forethought are your best tools.

Actually makes everything far MORE efficient.


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## Spencer (Jul 6, 2005)

BlueRidgeGreen said:


> I have fifty times the tools that will fit in my truck.
> 
> But I rarely need them all in one single day.
> 
> ...


We all have our different niche. Problem is I can't convey to everyone what my work will be like. I will be starting as a one man show. I know that will mean a larger quantity of smaller jobs. Likely even multiple jobs per day at times. I just know how I work and I need a lot of supplies/tools on hand to do what I do.

Not having a trailer is not even an option. That is the end of the debate for me personally. It is either get one or postpone starting up. That is the real debate.


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## mikeswoods (Oct 11, 2008)

I just changed trucks and haven't transferred all of the little seldom used items---boy has that cost me some time---

We are going to outfit the new truck one of these days----

I wish you luck, you already have the skills and drive needed--so good luck.

For a remodeler,a van is what I like--However, I just bought a super duty Ford with a utility body--as soon as I find a topper this truck will be the best I have owned.

I don't like trailers--Just hate driving with one and finding a place to park it --just me----they are dandy if you like dragging one around.


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## Spencer (Jul 6, 2005)

Jaws said:


> You got some operating money to get started with?


Yeah, not a ton. But enough to get things rolling. I would like if I had about 8 months cash for living expenses plus operating capital but that just isn't in the cards. 

I could pay cash for the trailer and a truck but that would leave me with to little money in the bank for comfort. I'd rather take out a loan than be stretched that thin right off the start.


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## BlueRidgeGreen (Apr 21, 2012)

Spencer said:


> We all have our different niche. Problem is I can't convey to everyone what my work will be like. I will be starting as a one man show. I know that will mean a larger quantity of smaller jobs. Likely even multiple jobs per day at times. I just know how I work and I need a lot of supplies/tools on hand to do what I do.
> 
> Not having a trailer is not even an option. That is the end of the debate for me personally. It is either get one or postpone starting up. That is the real debate.


I hear that. You said "remodeling". 

Like you said, you know how you work, that's the important thing.:thumbsup: To each his own.

Debt sucks. But you sound like you have a good solid plan. The interest on vehicles is minimal...especially new, so if you feel confident that you can generate enough income to cover the payments, why not let the bank help finance your start-up?
Most large trailer sales co's will finance also. Business loans may be tougher to get. Either way will work.

At this point, designing the racks and layout is key. Amazing how many options for how to jam all that stuff in there.

Good luck with everything.


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## BlueRidgeGreen (Apr 21, 2012)

Spencer said:


> Yeah, not a ton. But enough to get things rolling. I would like if I had about 8 months cash for living expenses plus operating capital but that just isn't in the cards.
> 
> I could pay cash for the trailer and a truck but that would leave me with to little money in the bank for comfort. I'd rather take out a loan than be stretched that thin right off the start.


Why bother paying cash?

Keep it in hand. Let the bank carry the load. Worth the cost as a de facto "insurance" payment. If you get stuck, they won't give you a "I need a few grand because I'm slow" loan.


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## Spencer (Jul 6, 2005)

This would be a great truck to start with. But I'm not ready to pull the trigger yet and its a little high.

$13k 2006 diesel. I'd rather have a 7.3 if I get a diesel but I love the setup of this truck.

http://www.autotrader.com/cars-for-sale/vehicledetails.xhtml?zip=46733&endYear=2015&vehicleStyleCodes=TRUCKS&modelCode1=F350&showcaseOwnerId=67414707&startYear=1981&makeCode1=FORD&searchRadius=200&maxPrice=13000&mmt=%5BFORD%5BF350%5B%5D%5D%5B%5D%5D&listingId=359680458&Log=0










Only think I'd add would be a rack.

I forgot to add that my uncle is a big guy in the RV industry and can get me a cargo trailer how I want it from the factory at cost. I haven't had him get me prices yet but that will help. I'm figuring 4k for the trailer and another 1k to get it set up.


Sounds like maybe my best bet would be to pay cash for the trailer and take a loan on the truck but wait to take the plunge until I'm sure I've got the operating capital to keep things floating well. Again, right now we put all of my wife's income towards our house so I would have that there if I needed it.


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## QCCI (Jan 28, 2013)

I agree with BRG and since this seems to be the route you want to go. I would look at a newer model truck though and finance it. The banks are more likely to finance a newer model and will stretch the payments out a little longer, usually with a lower rate also. Some places still offer zero percent for new trucks, you can't really beat that.

However I also think the less debt the better. But at this stage I think your cash is better used for operating expense. But if you do have enough cash, maybe buy the trailer. But look for a decent pre-owned, substantially less


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## skillman (Sep 23, 2011)

BCConstruction said:


> The problem with that is some people have way more tools than can fit into a truck.


 True but we don't use everything on one job .


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## The Coastal Craftsman (Jun 29, 2009)

skillman said:


> True but we don't use everything on one job .


Your right but it's knowing what your gonna use that's the problem. For me no 2 jobs are ever the same. They could be 2 identical bathroom remodels yet I require different tools for each. I worked in a transit for many years only taking the tools I thought I would need. On almost every job I needed a tool I didn't have with me or had to improvise and do it another way that was normally much slower and a lot less quality. 

Now I have 99% of the tools I need at all times. The only things I don't take is my axial glide, planner, tile cutters and saw etc etc things I know for sure I won't need.


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## ranteso (Nov 11, 2010)

Never take out a loan unless you can COMFORTABLY make double payments each month. I'm not saying make double payments, I'm saying you must be financially solvent so you can if you want. 

I've never understood the mentality of contractors driving around in very expensive pickup trucks (most not paid for) that are only good for lugging around firewood and pulling boats. 

Not that the OP is one of them, I'm just giving my personal opinion on my observations in the industry. 

Keep it simple and keep your overhead low because that's the only way you will survive in this industry. Even when the money is rolling in on very profitable projects, keep it simple and keep your overhead low. 

This is not to say Don't get a truck. If you need one you need one, but make sure you get what you need and not what you want.


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## The Coastal Craftsman (Jun 29, 2009)

ranteso said:


> Never take out a loan unless you can COMFORTABLY make double payments each month. I'm not saying make double payments, I'm saying you must be financially solvent so you can if you want. I've never understood the mentality of contractors driving around in very expensive pickup trucks (most not paid for) that are only good for lugging around firewood and pulling boats. Not that the OP is one of them, I'm just giving my personal opinion on my observations in the industry. Keep it simple and keep your overhead low because that's the only way you will survive in this industry. Even when the money is rolling in on very profitable projects, keep it simple and keep your overhead low. This is not to say Don't get a truck. If you need one you need one, but make sure you get what you need and not what you want.



If we done that then nearly all of us on here would never own a home. I can't afford to make double payments on a loan but can easily pay them each month. 

You don't seem to know much about trucks either. Expensive trucks are built on the same exact chassis as cheaper trucks. If the expensive truck can only move firewood and boats then that's all the cheaper one can. but in reality the more expensive truck normally has the better engine and tow options so its a better vehicle for working out off.


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## TxElectrician (May 21, 2008)

I think you will have a lot easier time getting a personal loan on the equipment than a business loan. Hard for a new guy, with little equity, to get a business loan. Buy it in your name and lease it to the company.


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## Jaws (Dec 20, 2010)

Spencer, sounds like you have a game plan.

This subject bring to mind a frame of mind I would suggest you adopt. There is nothing wrong with getting advice. But when getting council on any subject, always weigh the advice and make your own decisions. You are the decider, now. 

When you make a decision, never second guess yourself and work your azz off to make that decision a good one. When you make a mistake, roll with the punches and use the frustration as fuel and momentum to kick start again. Assess where you screwed up and why from an analytical position and then move on. Never spend a day depressed or wallowing in self doubt. Everyone screws up. Some let it get them, some dont. 

Don't wonder why the phone isn't ringing, go make something happen. 

Just my 2 cents, FWIW. 

I think you already know this, just might need a reminder as you go on your own.


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## schaefercs (Jul 10, 2008)

When I started my business I worked out of my jeep Cherokee. A little while after I bought a 6x10 trailer (while paying for a wedding). Can't even begin to explain how nice it was to not forget something and have to drive all the way back home. Lived with towing the trailer with the jeep for quite some time towing the trailer with the jeep. 

My point is, you don't need everything all at once. Let your business grow before you get in too deep. Your truck can and will tow a trailer, even if it's smaller than the 7x16 you want. Proper organization is key - I do all work in-house and have room to spare in my trailer. Only thing I don't bring every day is the tile saw. 

Start with your truck, add a trailer and outfit it nicely. Once you've been out on your own for a while and have more in the bank, you'll be able to afford a truck without signing your life away. Best of luck


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## Jaws (Dec 20, 2010)

TxElectrician said:


> I think you will have a lot easier time getting a personal loan on the equipment than a business loan. Hard for a new guy, with little equity, to get a business loan. Buy it in your name and lease it to the company.


This is what you will almost have to do. I know i couldn't get a line of credit at the bank for the business a year after we opened. Had to open in our names.


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## The Coastal Craftsman (Jun 29, 2009)

schaefercs said:


> When I started my business I worked out of my jeep Cherokee. A little while after I bought a 6x10 trailer (while paying for a wedding). Can't even begin to explain how nice it was to not forget something and have to drive all the way back home. Lived with towing the trailer with the jeep for quite some time towing the trailer with the jeep.
> 
> My point is, you don't need everything all at once. Let your business grow before you get in too deep. Your truck can and will tow a trailer, even if it's smaller than the 7x16 you want. Proper organization is key - I do all work in-house and have room to spare in my trailer. Only thing I don't bring every day is the tile saw.
> 
> Start with your truck, add a trailer and outfit it nicely. Once you've been out on your own for a while and have more in the bank, you'll be able to afford a truck without signing your life away. Best of luck


I used a 4.0L Jeep Cherokee to tow my loaded up 7x14 for at least a year so there's no doubt his f150 will handle it. It def was not the best thing to tow with and a truck would have been much better but it did get me by until i my new truck was delivered.


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## FrankSmith (Feb 21, 2013)

I started thee years ago. I looked at trucks and vans for a month while working out of an suv. I bought a used at&t van for $3,000 with tax title and license. It had very little rust and 87,000 mikes. I have been driving it ever since. The only thing I have had to do to it aside from regular maintenance is one new brake line. 

The way I see it having a new ride is a luxury for those who have put in their time. I hope to have a relay nice set up some day but in the mean time I enjoy making good money out of a cheap vehicle. Something tells me by the time I justify the new truck it will only have a tape measure in it.


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## Sabagley (Dec 31, 2012)

Maybe an older Uhaul cube van would work for you. I see them all the time for under 5 grand. Get a quick Maco paint job and slap some lettering on it. 

I started with a 6x10 trailer and literally had to unload everything to get at anything. It's hard on tools. I have a7x16 featherlite now and have always pulled it with my 1500.


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## JT Wood (Dec 17, 2007)

you can get a good f250/f350 gasser with low miles for under 8K trailer for 4k 

It might be hard to get a loan on a 10yr old truck that is uber overpriced.

My thoughts,


Get a loan for the trailer.
Drive the current truck till it takes a crap. I bet it lasts longer than you think. If it's that bad, it probably has no value anyway. So you might as well drive the wheels off it.


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## leeson1776 (Feb 6, 2012)

Just jumping in here without reading but here's what I'd do:

Look for the truck you want, and see if your local credit union (yes, go to a credit union) can lend you an extra few thousand dollars in the same car loan. They should be able to if you get a truck that you're paying say, $10k for but the bank values it at $14k; they'll let you borrow that extra $4k. Your rate will be reasonable (3 to 6% depending on credit) because the truck is the collateral for the trailer which you bought with that extra $4k. 

Otherwise, you'd probably be looking at a signature loan (10% plus) for the trailer unless you have it appraised.


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## Drgrafix (Jan 31, 2013)

So I've read the entire thread and I've gotta say, as the OP even stated in one of his posts, You gotta spend money to make money. I firmly believe this statement. Just about anyone, anywhere that has been successful in life will agree with this statement.

This is half the reason that most people will never be successful in life. They simply won't spend money, looking at the big picture. The other half is, they won't leave their comfort zone. You have to take risk once in awhile. That's how you get the reward. You just need to be taking calculated risks and not pissing in the wind sorta speak. The longer you wait, the less likely you will ever be to even attempt to pursue your goals. 

I love to build. I love running equipment and nothing beats seeing your hard work pay off when you see the end result. As a result of this, I spent almost all of my savings, quit an 80k+ a year job, and made the decision to go out on my own. I bought an excavator, a skid steer, and a house that needs $40k in work to fix up as a rental. Some, maybe even most, might call me foolish. But if your not doing what it is you want to be doing, only you can make the decision to change that. Worst case I end up working for someone else and making less money then I did before. But I'm confident I will find a way to make ends meet and push myself to be successful. 

So to the OP, I say spend the cash and buy yourself a trailer. Take out a loan on whatever truck you decide you want, since as was stated without reliable transportation, you won't be making any money. Credit is a good thing, just know your limitations and don't end up with more payments then you can afford at the end of the month. Cheers and goodluck with your adventure.


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## wnc viking (Aug 4, 2011)

If you are in flat land you do not need a deisel to pull that size trailer. The cost of a oil change and filters of sets any fuel mileage savings . And repairs are not cheap.


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## country_huck (Dec 2, 2009)

1) I would stay away from the diesel at all costs unless you plan on buying new with a full warranty, the repairs that will inevitably happen WILL be twice to three times that of a gasser. Unless your pulling massive amounts of weight you don't NEED it. 

2) I have a truck note and a small business loan, for me the truck makes me money and I can't afford to be down with repairs so I have a newer truck. I grew slowly to it came to the point where I could keep taking my profits and salary and sinking it to my business or take a small loan get the rest of what I needed and increase cash flow including salary. 

The key to all of this is to not get side ways, if all goes south I can sell everything off and not owe anybody anything. If you will not be able to do that than I wouldn't get the loan.


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## ranteso (Nov 11, 2010)

Home loans and vehicle loans are completely two different monsters. It's obvious to most I was addressing vehicle loans when stating you should have the financial resources to make double payments. There's a few reasons for that, one you can cut down the interest rate considerably at your will, and two you are not struggling to pay your debt. If you struggle to pay your debt you cannot afford that debt. Your loan payments should be waiting a month before they are due, if you're scrambling during the month to come up with the cash for your next payment, you're already in trouble. 

At the very least have 4-6 months of loan payments in reserve. The number one reason businesses fail is being under capitalized. Cash on hand is king.


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## The Coastal Craftsman (Jun 29, 2009)

ranteso said:


> Home loans and vehicle loans are completely two different monsters. It's obvious to most I was addressing vehicle loans when stating you should have the financial resources to make double payments. There's a few reasons for that, one you can cut down the interest rate considerably at your will, and two you are not struggling to pay your debt. If you struggle to pay your debt you cannot afford that debt. Your loan payments should be waiting a month before they are due, if you're scrambling during the month to come up with the cash for your next payment, you're already in trouble. At the very least have 4-6 months of loan payments in reserve. The number one reason businesses fail is being under capitalized. Cash on hand is king.


Yes but not many people have this cash on hand when they start and it's the reason for getting a loan. Spencer is in the same exact situation I was in. Making just min wage working in a sandwich shop and doing construction on the weekends and my days off. I was going no where fast. I decided to get a trailer first to build my credit for a year then bought a new f150. I'm now earning more in a day than I was earning in a week at the sandwich shop. 

I now have $30k equity in my vehicle trailer paid off and more tools than most contractors and I owe nothing on any of them yet I started with loans and credit cards to get into a position where I gave the tools required to do my job well. 

Spencer's in the same boat now.


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## Nick R (May 20, 2012)

How about a nice clean van? All that stuff fits nicely in a regular size van minus the brake (all the time). Out of the weather and your only spending/loaning on one thing.


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## Spencer (Jul 6, 2005)

This is my current truck: 1998 F-150 with 4.6 V8 and about 135,000 miles. She has been good to me. I only paid $4500 for it 5 years ago. It isn't worth anything but I haven't had to put any money into it in a long time. Mainly because I don't fix anything on it unless it is critical to keep it running.

I know some are suggesting using this to pull the trailer. Here is the deal. She is rusty. Last year I noticed the muffler hanging low. Ended up just pulling on it and ripping the whole thing off. Has a bad exhaust leak somewhere in the engine but that doesn't bother me. There is no towing package. So if I want to try and pull with it I'll have to add a hitch along with the trailer brake controller. 

Now what say you? Put the hitch on, try it, and run her till she dies?


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## FlyFishRI (Aug 17, 2013)

I have essentially the same truck but with the 5.4, 8.8 limited slip in the rear and tow package. If the frame is solid, that wont have any issue pulling a trailer. Few hundred bucks and you have a hitch, wiring and brake booster. Could even get all that at a junk yard for next to nothing since so many of these trucks have them. 

I don't even have side boxes and can fit everything I need for remodeling, especially if it isn't raining. Table saw and bag of cordless tools behind driver seat, 12" sliding miter saw and circular saw in case behind the passenger along with a 2' level on the floor, 4' level sits on top of the rear seat when it is folded up, Rolair JC10 goes on the passenger seat and tool bags and lunch box on the floor. Hoses and cords go on top of the miter saw and nail guns get tucked between stuff. Hand tools are in a bostitch weatherproof box in the bed with saw stand and ladders. I don't have a garage so it is nice being able to leave everything in the cab. You are spoiled being able to pull in and go in the house and not worry about what is in the bed!


I totally agree with spending money to make money, I just try to make sure it is money I have. Believe me, I wouldn't mind a newer truck but what I have works great and I know it is a huge risk to borrow money when you don't know what the year will bring.

Good luck with whatever you choose.


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## FlyFishRI (Aug 17, 2013)

I think someone suggested a loan for a trailer and the a truck after that, that might be the best bet if you are set on a newer truck. If you can pay off both in a year you should be able to pay off the trailer pretty quick. This will give you enough time to save a little extra as well as get an idea of what work you will have lined up.


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## wnc viking (Aug 4, 2011)

Or start out in a smaller trailer with that truck trailers are easy to resale when you want a bigger one and you have a better truck to tow with


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## plazaman (Apr 17, 2005)

You gotta check your finances and see what's doable . Nothing wrong with financing a vehicle of you can make the payments .


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## rrk (Apr 22, 2012)

How do you get a business loan these days when you don't have a business, business history, 5 years of business tax reports .......

As for your need for a trailer because you do "everything" and don't know what you will need each day. Most of us here do or did "everything" at some point in our business, not all had to have trailers to survive. Where I work hardly any have trailers but there are tons of contractors here who do everything and have been in business a long time.

Your truck looks plenty big to me to hold everything you will need with a little bit of planning, and learning to be efficient. Then once money is saved you can do what you want.


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## NCMCarpentry (Apr 7, 2013)

Other than it being a ford I don't see why your truck would have a problem with a pretty reasonably sized trailer.... Learn the ins and outs of it and keep it well maintained and lubed. You don't need to be rated for 3x the weight of the trailer


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## CarrPainting (Jun 29, 2010)

I didn't read it all... But look on Craigslist for a trailer.

A 7x14 is a good size trailer... I have one, I pull it with a ranger... It's a utility trailer.

Check put CL for say a 6x10 you can pay cash for. Smaller than what you want, but bigger than what you have and it won't put as much strain on your truck..

As of right now, that is what I would do...

Here's why:

The current economic situation in the US, is down right ugly. 1/3 of working age, able bodied Americans are unemployed. We have record taxes, and a stock market that is higher than ever before in history.

I bring this up because this has a Direct implication to borrowing money... DO NOT borrow money right now...DON'T DO IT!

The stock market is going to have a 'correction'. That's the nice way of putting 'crash'. The clock markets are so grossly over valued its disgusting! They are going to crash with in the next 12-18 months. When that happens, it will absolutely pulverize the economy.... To put it in perspective, the worlds GDP is around 50 trillion a year. The derivitives market, which is what's fueling much of the stock markets right now, is well over 600 trillion!

When it resets, aka crashes, you want to have the least amount of debt as possible...

Keep your F150, buy a smaller trailer.

Pay with cash. Borrowing money, today, now, is a HUGE mistake...


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## Spencer (Jul 6, 2005)

CarrPainting said:


> I didn't read it all... But look on Craigslist for a trailer.
> 
> A 7x14 is a good size trailer... I have one, I pull it with a ranger... It's a utility trailer.
> 
> ...


You are talking for a fellow economics buff. I have had a doomsday perpective since the day I woke up to the world around me sometime after 2008 crash.

True story, I have a friend my age, 25. He has money, rich dad and he makes 90k/yr as an actuary. Sometime around 2010 he is telling me that he is buying stocks. I tell him he is nuts, this economy is a house of cards and the stock market is overvalued and will crash again. He is sitting on 40% profit that he would not have had he listened to me.

The truth is it is a house of cards but that doesn't mean it will fall. I traded precious metals up until about a year ago (dumped all my money into my house.) All I can say is that things are not what they seem in the market world. There are big players out who are capable of controlling the outcome of the "markets" more than we can imagine.

The crash of 2008 was aweful because of an aweful real estate bubble stimulated by federal policy. There were signs everywhere if you had eyes to see. When the money is unrealistically good, and the charts go parabolic, that is when to look for a crash. The DOW has had a steady increase and the chart actually looks really good. There won't be a crash anytime soon apart from a geopolitical event because there isn't enough sloppy money flying around yet. I'm as pessimistic as they come on our economy and if I'm saying this there are another hundred people for every one of me who live in lala land and are buying it.

This is the yearly silver chart. Notice the parabolic rise from early 2010 to mid 2011. I rode that mother up the whole way and made the mistake of "leveraging up" towards the top when greed got the best of me. When you see a chart that looks like that you call for a correction. The yearly chart on the dow is very controlled ascent. I don't see it happening....yet.










This is the current dow chart. Very controlled accent with healthy corrections along the way. Not signalling any type of economy halting correction. If it starts to go steeper and you don't see as many healthy corrections along the way that is when you pucker up and get ready for it. Its when everyone and their brother switch from buying long to SELLING SHORT that you get a crash.









http://www.google.com/url?sa=i&rct=j&q=dow%20yearly%20chart%205%20yr&source=images&cd=&cad=rja&docid=bqnpMKfFJqoH9M&tbnid=crNuDlUw5LasOM:&ved=0CAUQjRw&url=http%3A%2F%2Ftrendfollowingmalaysia.com%2Ftag%2Ffutures-trend-following%2F&ei=KEzJUviYCu_iyAHt_IHIDA&bvm=bv.58187178,d.aWc&psig=AFQjCNEXOzzOuRdSbVOM63etmvFkF1X43w&ust=1389010300340821

Just to be clear, I am loaded up on food storage, guns, and ammo. I prepare for the worst outcome and will also do so with this business decision. I appreciate the advice.


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## Spencer (Jul 6, 2005)

CarrPainting, 

I just want to clarify, I'm with you 100%. I have read all about the derivatives market. I'm just making the point that I've had to learn a personal lesson through all these things. I've sat on my hands out of fear. That is wrong. The right thing is to evaluate the situation, make preparation for the worst outcome, and move on in life. The way the world is today, a guy could spend his entire life doing nothing because the next big crash is coming.

I had about $70k saved because I thought I needed to pay cash for my house to "be safe and secure." Sometimes you just have to take the risk and get a freakin house.


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## mikeswoods (Oct 11, 2008)

Just be careful about over thinking and letting all of the unknowns stop you from ever making a move.

I've had several business over the course of my life---a lot of the time I moved on my gut feeling that I could succeed---

Other times I had little choice but to make my own paycheck---and make do with what I could afford--and parlay my earning to get the right tools and equipment.

I hate debt and have grown all my businesses with earnings--not loans. Kind of old fashioned thinking---but it worked for me---


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## pinwheel (Dec 7, 2009)

mikeswoods said:


> Just be careful about over thinking and letting all of the unknowns stop you from ever making a move.
> 
> I've had several business over the course of my life---a lot of the time I moved on my gut feeling that I could succeed---
> 
> ...


I also hate debt, but sometimes it's a necessary evil. 

But like you, we've built our business on it's earnings, not debt. I'm getting ready to buy a second paint sprayer. Got 2 jobs that will justify & pay the expense of the new tool. That's how I've accumulated the majority of the tools I own. And trust me, I own a lot of tools.

I've got vehicle payments & probably always will. I'm not gonna rely on undependable used junk cars & trucks as long as I can afford not to.


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## mikeswoods (Oct 11, 2008)

I do agree---vehicles and real estate might be the two exceptions---

However, if you must borrow--keep the payments low enough that they will not sink your business during a bad spell---


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## pinwheel (Dec 7, 2009)

mikeswoods said:


> I do agree---vehicles and real estate might be the two exceptions---
> 
> However, if you must borrow--keep the payments low enough that they will not sink your business during a bad spell---


Besides some minor credit card debt because of overuns on the new shop, my farm & our 2 vehicles are the only loans we've got.

I do occassionally borrow 3-6 months zero interest loans on new tool purchases. But only after I ask what the cash price is. If it's no different, I'll run on their money instead of my own.


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## overanalyze (Dec 28, 2010)

Debt on some level is healthy for a business. We have had small lines of credit, equipment loans, and vehicle loans. We always kept the payments small or we didn't do them. We always had the payments automatically taken out because it knocked 1/2% off the rate. And we always have more than the mininum payment taken out. 

This translates into an excellent banking relationship that means if we need a loan for something, we get it without any hassle. 

For your situation, try and get a small loan in your buisiness name. You will have to personally guarantee it (no big deal). Pay it off early. It will only help you long term.

Skip the truck for now. A diesel is unnecessary for pulling that trailer. They cost more up front, cost more in fuel, and cost more when they break. Our current van is a one ton diesel superduty and I wish it were a gasser. Your truck will be just fine for a year or two. 

Good luck and post some pics of your new trailer!


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## BlueRidgeGreen (Apr 21, 2012)

I think that after insulting that gorgeous "experienced" F150 with talk of replacing her.....you will have to let her go.

She will never really forgive you, and she's right not to.


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## FlyFishRI (Aug 17, 2013)

Pinwheel, my truck is an unreliable piece of junk because it is paid off?


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## pinwheel (Dec 7, 2009)

FlyFishRI said:


> Pinwheel, my truck is an unreliable piece of junk because it is paid off?


Gotta love the internet, where people read more into words than is meant, just because they like being offended.:thumbup:


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## A&E Exteriors (Aug 14, 2009)

Spencer said:


> This would be a great truck to start with. But I'm not ready to pull the trigger yet and its a little high.
> 
> $13k 2006 diesel. I'd rather have a 7.3 if I get a diesel but I love the setup of this truck.
> 
> ...


If that has the 6.0 make sure its been bulletproofed


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## Inner10 (Mar 12, 2009)

FlyFishRI said:


> Pinwheel, my truck is an unreliable piece of junk because it is paid off?


TNT this is an example of aunt Sally.


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## A&E Exteriors (Aug 14, 2009)

Ok....after reading all of this and looking at your truck... I'd put some heavy duty coil over shocks on the back, throw the hitch on it, good tune up, and get your trailer and pay it off. Then upgrade the truck in 6 months to a year. Find you a 7.3 superduty with 150-200k for about 8-10k and have all you need and want.

Your current truck is no eyesore/ rustbucket


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## AustinDB (Sep 11, 2006)

I think I'll go w/ a gas engine next truck, don't believe they are worth it for me. Consider getting a less expensive gas truck (cost savings) then save $$ and buy the truck you want later. 

Or you could be like some of the big shots I see driving around in $55,000 decked out King Ranch's, no idea what kind of payment they have, but I guarantee you my paid for Sprinter helps me sleep at night w/ less stress.


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## Jaws (Dec 20, 2010)

Spencer said:


> This is my current truck: 1998 F-150 with 4.6 V8 and about 135,000 miles. She has been good to me. I only paid $4500 for it 5 years ago. It isn't worth anything but I haven't had to put any money into it in a long time. Mainly because I don't fix anything on it unless it is critical to keep it running.
> 
> I know some are suggesting using this to pull the trailer. Here is the deal. She is rusty. Last year I noticed the muffler hanging low. Ended up just pulling on it and ripping the whole thing off. Has a bad exhaust leak somewhere in the engine but that doesn't bother me. There is no towing package. So if I want to try and pull with it I'll have to add a hitch along with the trailer brake controller.
> 
> Now what say you? Put the hitch on, try it, and run her till she dies?


Nothing wrong with this trucks looks. Looks professional. 

Only you can assess how long it will run hauling a trailer. I'd say give it a shot though. Do a real good tune up on it and then give it a go. 

If your wife makes enough for yall to live on, pay your self a small salary for a year and pump all the money into your company (truck, operating capital)

My 2 cents


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## 98crewcab (Oct 7, 2013)

i think, after reading all these posts, that I am more of the "buy what I need to be comfortable with what I do..." If im cramped. or cant carry what I need to keep the "what do i need for tomorrow sleeps" away.... Its no fun...

that being said, was in the same position, made the jump, and its working out great for me.

I worked at a cabinet shop. making $18/hr. no benefits though. I rode my Hayabusa 1300r back and forth to save gas (not that I got much more than 20mpg with that 1441 stroker kit) lol. for side work I borrowed a buddies flatbed car trailer and towed it with my wifes Yukon. (alot of my work was cabinets and light remodels) have to say it was an absolute pain in the ass. I dreaded it as I knew id have to PACK that yukon to get everything in it, and being careful in doing so as it was a family ride, not a dump truck. AND any cabinets I hauled had to be protected from whatever weather....(luckily i live in Cali) but still an occasional drizzling here....lol

finally one day, a few years over due for a raise as I am pushed into more and more responsibilities, decided to thank my boss for every thing I have learned, thanked him for the experience, gave him a firm handshake and was on my way. financed a 2006 truck, financed a brand new 7X16 tandem axle trailer, loaded it up and was off. never looked back. This was May of last year. and no regrets what so ever. Applied for my gen b license, and this thursday finally taking the test. (took them, CSLB, over 6 months to get this far) We did have to cash in some of my 401K to help carry us through here and there, but thats starting to go back in AND covering the truck and trailer payments with what we are making now. I say, whats the fun in life if you hold back because of what may happen in the world. live for today (in a somewhat responsible way) and push yourself to succeed.

that being said.....some pics to get you started....


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## Spencer (Jul 6, 2005)

Thanks for sharing your experience 98crewcab. A man after my own heart. Nice job on the trailer setup too. I'll be coming back to that when the time comes.


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## Spencer (Jul 6, 2005)

Thanks for all the great advice. I'm getting a hitch coming and right now I'm trying to figure out how to get my 4 prong turned into a 7-rv to control the trailer brakes. Good thing my dad has done all this kind of stuff before.

I'll be getting in touch with my uncle to get some quotes on different trailers. Again, he can get me a few different lines of trailers at factory cost. 

It will be interesting to see how things go with the boss. We have been discussing me leaving, they offered a big pay raise but then kind of came back on it when I said I wasn't sure if I'd stay more than a year. Lord willing this spring I'll enter the school of hard knocks.


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## TxElectrician (May 21, 2008)

Very neat setup 98crewcab:thumbsup:


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## CarrPainting (Jun 29, 2010)

I personally have a 1995 Ford E350 cube van....










It has 110k miles. It's cheaper for me to replace the engine and or transmission, knock on wood, than it is to buy a new truck. Plus since its pre '96 I'm exempt from all the costly emissions.

Oh and it's paid off and not a diesel. I average 8mpg.


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## 98crewcab (Oct 7, 2013)

thats nuts.....'96 is the cut off for emmissions??? here we have to smog to ......I think '75..'76?


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## SectorSecurity (Nov 26, 2013)

98crewcab said:


> i think, after reading all these posts, that I am more of the "buy what I need to be comfortable with what I do..." If im cramped. or cant carry what I need to keep the "what do i need for tomorrow sleeps" away.... Its no fun...
> 
> that being said, was in the same position, made the jump, and its working out great for me.
> 
> ...


I need someone like you to come shelve out my van :thumbup:


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## Spencer (Jul 6, 2005)

Just as an update. After talking talking to a couple of our CT guys through PM/Phone I decided that a van is going to be the best bet starting out. I'm looking at spending about 8-12k on a Chevy 3500 Express Extended. I think it will serve me well and in the long run save me money for these first few years. Its funny as I went back and reread this thread how many guys suggested a van yet I completely ready over it because it wasn't what I had envisioned in my mind.

Since my truck isn't worth much of anything anyway I plan to keep it and have that option should I need the truck.

I think it will be a much safer bet and more efficient. I'll keep everyone posted on what I find. I'm looking down in Kentucky at a huge work vehicle dealership to see if they can get me what I want. Mainly I'm looking for less than 150,000, rust free southern, prefer no windows in the back or side door.

Thanks again for all the priceless advice.


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## KAP (Feb 19, 2011)

Spencer, it sounds like you are intent on going the debt route, but I would rather work 60 hour weeks than do that... this way, I would KNOW that I am working for myself and not the bank...

You are awake 112 hours a week, what you do with them is up to you...

If you have the business, all you need is time... borrowing delays success for most...


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## Inner10 (Mar 12, 2009)

98crewcab said:


> i think, after reading all these posts, that I am more of the "buy what I need to be comfortable with what I do..." If im cramped. or cant carry what I need to keep the "what do i need for tomorrow sleeps" away.... Its no fun...
> 
> that being said, was in the same position, made the jump, and its working out great for me.
> 
> ...


Hayabusa and a yukon at 18 bucks an hour? You're wife must have a good job!


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## pinwheel (Dec 7, 2009)

Spencer said:


> Just as an update. After talking talking to a couple of our CT guys through PM/Phone I decided that a van is going to be the best bet starting out. I'm looking at spending about 8-12k on a Chevy 3500 Express Extended. I think it will serve me well and in the long run save me money for these first few years. Its funny as I went back and reread this thread how many guys suggested a van yet I completely ready over it because it wasn't what I had envisioned in my mind.
> 
> Since my truck isn't worth much of anything anyway I plan to keep it and have that option should I need the truck.
> 
> ...


I started with a van. Worked well for a while. Progressed to a 15' box truck & am now using a late model f 150 & 7x14' trailer with ramp door. After a while, you'll grow to hate the van, or at least I did. 

Long term success will come quicker if you can keep more of your money in your own pocket, rather than giving it all to the banks. Don't have to have all the flash getting started, build into it.


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## Spencer (Jul 6, 2005)

pinwheel said:


> I started with a van. Worked well for a while. Progressed to a 15' box truck & am now using a late model f 150 & 7x14' trailer with ramp door. After a while, you'll grow to hate the van, or at least I did.
> 
> Long term success will come quicker if you can keep more of your money in your own pocket, rather than giving it all to the banks. Don't have to have all the flash getting started, build into it.


I just don't see how I can call my self professional.....and sell myself as a professional....rolling up in $1500 pickup with a bunch of tools thrown in the back getting rained on. Then trying to price job competitively and yet still make enough to grow when I don't even have my work vehicle outfitted to work efficiently. 

Someone who knows gave me a piece of advice, "If you start out working for the wrong people at the wrong price you will have to fight like hell to get free from it." 

I'm trying to find a happy medium here....I know I'm going to start out with the best jobs working for the best people but at my current job I see the guys all day long who roll up in a pickup with a few tools barely getting by because no one will pay them anything because they aren't worth anything.

I have to be efficient to make money.

I guess I just don't think driving around a 1 ton van as flashy. My thinking is if I can find one that will work for 4-5 years, look decent, be reliable, and be functional it will pay for itself vs trying to jam a truck cab full of tools.

Sometimes you just have to grab the bull by the horns and make it happen and it is time to grab the bull.


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## KAP (Feb 19, 2011)

If that is your concern, use your wife's car for appointments to measure and price at night...

People will care less about the vehicle that you drive versus the workmanship and professionalism you display...

Referrals don't come from someone because of the vehicle they drive...

You are literally using the same reasoning most guys do when they WANT something versus needing it...

But I wish you the best with whatever you end up with... :thumbsup:


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## Spencer (Jul 6, 2005)

KAP said:


> Spencer, it sounds like you are intent on going the debt route, but I would rather work 60 hour weeks than do that... this way, I would KNOW that I am working for myself and not the bank...
> 
> You are awake 112 hours a week, what you do with them is up to you...
> 
> If you have the business, all you need is time... borrowing delays success for most...


The most successful people I know have borrowed money in numbers bigger than what I can fathom. You just have to make sure you are covered and not over extend yourself/spend unneccessarily. 

Is a farmer going to grow a farm if he adopts the mindset that I'm not giving any money to the bank? 

Is an excavator going to make big money if he waits until he can pay cash for every piece of equipment? 

I am talking about real life people that I see every day. They drive around new trucks because they have created cash machines. Yet they still have debt because they know you have to borrow money to make "more" money. 

I know guys who are in their 60's who are multimillionaires who still have debt because they know they can make the numbers work. If I have 500 acres paid for and can borrow a million for another 200 acres and use the money that my 500 is producing + the 200 to pay down the debt you are going to get the 200 paid for faster than waiting to pay a million in cash. 

Just an example, I know there has to be balance and moderation in everything.


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## Spencer (Jul 6, 2005)

KAP said:


> If that is your concern, use your wife's car for appointments to measure and price at night...
> 
> People will care less about the vehicle that you drive versus the workmanship and professionalism you display...
> 
> ...


Don't get me wrong. I truly appreciate the advice and am thinking a lot about it. I have the cash in the bank but need it for operating capital.

Maybe I'll look for something around less expensive...thinking...


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## 98crewcab (Oct 7, 2013)

Inner10 said:


> Hayabusa and a yukon at 18 bucks an hour? You're wife must have a good job!


We do alright. she has a decent paying job. she runs a floral shop. nothing big, but it helps. but most of what we put in the bank came from side jobs at that time. we mostly did store fixtures at the cabinet shop I was at, so as long as I paid for the "shop resources" I could use it as often as I wanted, and he, the owner, had enough going on that he didn't care how much residential cabinetry I drug through there. as long as it NEVER interfered with our daily work load. Actually was refereed several jobs by him 

The bike, we paid cash for. used. got it for $6K. have a buddy, Mike Fields, in sac that does only high performance hayabusas, hooked me up with the motor work for about $3K. we traded some work to get that down to about $1500 out of pocket. dyno time and tuning was free from another buddy. she's stretched, lowered, and has come close 200mph many times:laughing::laughing:




And, her Yukon was also bought used. bone stock 4.8 liter. We just threw on some wheels to get her by until we can get her something nice down the road. Here is my son posing when we sent her pics of her yukon with the new wheels. (they were a surprise while she was at work...)



we got that often....the whole, "wow, at 18 bucks an hour?!" Side work easily doubled our income.


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## 98crewcab (Oct 7, 2013)

Spencer said:


> The most successful people I know have borrowed money in numbers bigger than what I can fathom. You just have to make sure you are covered and not over extend yourself/spend unneccessarily.
> 
> Is a farmer going to grow a farm if he adopts the mindset that I'm not giving any money to the bank?
> 
> ...


I agree 100%. I don't know ANYONE that can just pull that kind of cash out of their ass when starting out. Id also rather keep the cash i had for the same reason. easier to finance a truck/van than to finance business costs...



P>S>, sorry for the thread jack above, I should have pm'ed inner10


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## pinwheel (Dec 7, 2009)

Spencer said:


> I just don't see how I can call my self professional.....and sell myself as a professional....rolling up in $1500 pickup with a bunch of tools thrown in the back getting rained on. Then trying to price job competitively and yet still make enough to grow when I don't even have my work vehicle outfitted to work efficiently.
> 
> Someone who knows gave me a piece of advice, "If you start out working for the wrong people at the wrong price you will have to fight like hell to get free from it."
> 
> ...


I'm not advising you not to ever borrow money. Hell, I've got a note on my farm, my truck & my car. I'm just advising you not to get over extended trying to look professional.

The majority of the work I get, isn't because someone seen my truck or trailer, it's because their friend, bankers, co workers, ect recomended me to them. Focus more on making sure that every & I mean every client is satisfied & excited the job you done for them & no one will give a **** what you pull up in front of their house in.

My recipe for success has been to alot a certain amount of every job to upgrade tools, vehicles, trailers, shops, ect, ect. I didn't get everything overnight, but at this point, I owe no one anything for my business. It's all mine..........and my wifes.:laughing:


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## Spencer (Jul 6, 2005)

pinwheel said:


> I'm not advising you not to ever borrow money. Hell, I've got a note on my farm, my truck & my car. I'm just advising you not to get over extended trying to look professional.
> 
> The majority of the work I get, isn't because someone seen my truck or trailer, it's because their friend, bankers, co workers, ect recomended me to them. Focus more on making sure that every & I mean every client is satisfied & excited the job you done for them & no one will give a **** what you pull up in front of their house in.
> 
> My recipe for success has been to alot a certain amount of every job to upgrade tools, vehicles, trailers, shops, ect, ect. I didn't get everything overnight, but at this point, I owe no one anything for my business. It's all mine..........and my wifes.:laughing:


I see what you're saying and I appreciate because I do have a love for good equipment that isn't necessarily healthy from a dollars and cents standpoint. I weigh your opinion very heavily.


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## pathway (Jan 9, 2014)

Just my experience....I've driven brand new and $2000 junker trucks & to be honest some of my highest sales years were in the junker. Theres plenty of guys putting priority on how they look but can't pay their bills on time. I've been that guy too. If you want to be in business 5 years from now spend less time worrying how you look, & make the money before you spend it. There are plenty other ways to be more efficient than a decked out work truck. Yes it gives an impression, but you will never lose a bid soley on how your vehicle looks. It's your personality & work quality/habits that get you the repeat business that will pay for your future work truck. JMHO


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## TrulyNoble (Jan 13, 2014)

http://www.trulynobleservices.com/


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## Inner10 (Mar 12, 2009)

98crewcab said:


> We do alright. she has a decent paying job. she runs a floral shop. nothing big, but it helps. but most of what we put in the bank came from side jobs at that time. we mostly did store fixtures at the cabinet shop I was at, so as long as I paid for the "shop resources" I could use it as often as I wanted, and he, the owner, had enough going on that he didn't care how much residential cabinetry I drug through there. as long as it NEVER interfered with our daily work load. Actually was refereed several jobs by him
> 
> The bike, we paid cash for. used. got it for $6K. have a buddy, Mike Fields, in sac that does only high performance hayabusas, hooked me up with the motor work for about $3K. we traded some work to get that down to about $1500 out of pocket. dyno time and tuning was free from another buddy. she's stretched, lowered, and has come close 200mph many times:laughing::laughing:
> 
> ...


I'm very envious of that bike...but seeing as I ride a couple hundreak km a year buying someting like that would result in the loss of half my house. :laughing:


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## KAP (Feb 19, 2011)

...


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## 98crewcab (Oct 7, 2013)

KAP said:


> I know a guy who nets over $100K/ year painting cabs and does it all, including taking doors/drawerfronts back to his place to work on them, in a week to a week and a half. That's all he does though...
> 
> I can't relate to 8 weeks to paint a kitchen... that's replacing a whole kitchen and then some... and that includes inspections... I'd really want to know what the heck is taking him so long? We've all had over-runs, but 8 weeks?
> 
> For the pic above, I would guesstimate a week or so if they were keeping existing doors... we don't do that often as we replace in most cases, and all we do is paint the carcases and replace the drawers... Install the pre-painted fronts in a day... opens schedule up for more work, and is more profitable...


:whistling this the right thread bro? what chu talking about? lol


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## KAP (Feb 19, 2011)

98crewcab said:


> :whistling this the right thread bro? what chu talking about? lol


Ooops... 

Thanks for the catch... :thumbsup: 

Re-submitted under the right one... http://www.contractortalk.com/f8/refinishing-cabinets-143822/index2/#post1932858


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## Gary H (Dec 10, 2008)

I did a porch this summer. Across the road was another contractor redoing a house. I got a old dodge truck, clean but rusty with bed full of tools. They all got new or newer trucks and fancy painted trailers.yeah you could feel the smirks and hear the laughing.

I show up at 8 and don't leave till 5 pm or so. 

Them. Show up at 9 or later and then spend the rest of the leaving and coming back to the job site. All day long . For the whole week. Theisr credit line must have been low because they seemed to only buy enough lumber till it was time for another drive. And off they would go and bring back some more material. . The customer remarked that he got a good deal on my price because I stayed there all day. Therefore he didn't have to pay for all that has the guys across the road have to add to thier bill. 

I laughed because he paid for the gas , I just pocketed the gas money as unused expense.

These guys seem to be the Home Depot contractors. They are in the parking lot all day long everyday. Maybe they are making a killing. But most likely it's just a grand illusion. A front.


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## rrk (Apr 22, 2012)

Spencer said:


> The most successful people I know have borrowed money in numbers bigger than what I can fathom. You just have to make sure you are covered and not over extend yourself/spend unneccessarily.
> 
> Is a farmer going to grow a farm if he adopts the mindset that I'm not giving any money to the bank?
> 
> ...


You have zero full time experience in this field and you are comparing yourself to 60 year old millionaires and full time excavators?
Up to this point you are a tool collector, until you quit your job and do this full time supporting a family everything is speculation . 
People don't care what you drive as long as it is fairly neat, they don't care that you have any Festools, they have no idea or do they care how old your truck is.

What they care about is you showing up, doing a great job at a fair price. Until you actually get out there full time you really will not know what works and what doesn't work for you. 

Take the next step and get out there. Make what ever you have right now work, you will learn a lot more very quickly. You will realize that you cannot be prepared for every thing every day, but you will figure it out and you will survive.


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## FlyFishRI (Aug 17, 2013)

Just buy a car dolly and haul that van around with your tools in it. Best of both worlds.


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## Gary H (Dec 10, 2008)

A lot of builders that have money are 2nd 3rd generation family. Just like farmers. That old money. They don't borrow because thier dad or grandad busted his a$$ and provide for his family . Then the kid took over with a very early back ground in the family business and moved forward. As long each family is hard workers and don't blow thier wealth on loans and interest payments they will succeed . 

I did not see before that u had a day job. As rrk said until you get off the steady pay check , you really don't know about hardship. That fancy bike will be on cl so you can buy food for the family. 

Cut ties with your employer first Monday morning and join the real world of self employed contractors.


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## Inner10 (Mar 12, 2009)

rrk said:


> You have zero full time experience in this field and you are comparing yourself to 60 year old millionaires and full time excavators?
> Up to this point you are a tool collector, until you quit your job and do this full time supporting a family everything is speculation .
> People don't care what you drive as long as it is fairly neat, they don't care that you have any Festools, they have no idea or do they care how old your truck is.
> 
> ...


This was really well put.

Spencer show me a guy that borrowed a stack of bills to start a company and became a smashing success and I'l show you a list of bankrupt ones as long as my arm. For all you know you could fall flat on your ass in the first 6 months...get your feet wet and get a taste of the reality of running your own business before you decide to jump in wallet first.


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## Spencer (Jul 6, 2005)

rrk said:


> You have zero full time experience in this field and you are comparing yourself to 60 year old millionaires and full time excavators?
> 
> That was an insult if there ever was one. Zero full time experience??? Where did you pull that from? I was making a statement that at times you have to borrow money to make money. Its a statement about finance. I wasn't in any way comparing myself to a multimillionaire in any way other than having the ambition to be one. Maybe that is wrong in your book? I've been paying my dues in this industry for nearly ten years working full time gaining experience under a variety of different jobs. To many on here that isn't very much time, but for me, at 25 it is all I have to offer. Look over on the side of your screen. I've been soaking up every bit of information I can from this site since 2006. I may not have the most posts but I would venture to guess I've read as many threads on this site as the best of them. I know I have a lot to learn but don't sit here and talk to me like I'm some office lacky that got a wild hair up his @ss and decided he wanted to have a carpentry business. I have put my life into this.
> 
> ...


I appreciate your advice but I'm low on sleep and that post really rubbed me the wrong way.


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## Spencer (Jul 6, 2005)

Gary H said:


> A lot of builders that have money are 2nd 3rd generation family. Just like farmers. That old money. They don't borrow because thier dad or grandad busted his a$$ and provide for his family . Then the kid took over with a very early back ground in the family business and moved forward. As long each family is hard workers and don't blow thier wealth on loans and interest payments they will succeed .
> 
> I did not see before that u had a day job. As rrk said until you get off the steady pay check , you really don't know about hardship. *That fancy bike* will be on cl so you can buy food for the family.
> 
> ...


...


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## Inner10 (Mar 12, 2009)

Spencer said:


> I appreciate your advice but I'm low on sleep and that post really rubbed me the wrong way.


Of course it did because his post was the harsh reality of the situation. You have countless hours sawing boards and banging nails but he's talking about running a business.


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## Spencer (Jul 6, 2005)

Inner10 said:


> Of course it did because his post was the harsh reality of the situation. You have countless hours sawing boards and banging nails but he's talking about running a business.


I realize what he's sayin. All I'm saying is he comes across like he thinks he's king tut or something.


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## Inner10 (Mar 12, 2009)

Spencer said:


> I realize what he's sayin. All I'm saying is he comes across like he thinks he's king tut or something.


He certainly didn't sugar coat it but what he said is right on the proverbial money.

When I started my company it was like buying my first house, I felt like the first few months I did nothing but throw money out in the wind, then load up my credit cards.

The most important tool in business is working capital, some jobs you will throw out tens of thousands of dollars and not get a penny back for months. If you sink yourself before making your first material purchase you may find yourself low on credit.


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## Spencer (Jul 6, 2005)

By the way, I went to Chicago last night and bought a van. 2008 E-350 Super Duty Extended Cargo. 113,000 miles. Paid $6800 CASH. Good shape and runs like a champ. At that price its 2.5-5K under blue book value. I feel good about it. It was exactly what I was looking for, right condition, and right price.


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## pinwheel (Dec 7, 2009)

Don't let em get to ya spenser. You're a sharp kid with a good head on your shoulders & a lot of ambition & hustle. You're gonna land on your feet man. But you've got some hard times ahead of ya. Getting started on your own is gut wrenching & nerve wracking. Get used to not getting a lot of sleep. When the jobs aren't lined up & the bills are still coming in, you won't sleep much, trust me on this, been there.


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## pinwheel (Dec 7, 2009)

Spencer said:


> By the way, I went to Chicago last night and bought a van. 2008 E-350 Super Duty Extended Cargo. 113,000 miles. Paid $6800 CASH. Good shape and runs like a champ. At that price its 2.5-5K under blue book value. I feel good about it. It was exactly what I was looking for, right condition, and right price.



Good deal man, glad to hear you won't be saddled with a bank note.:thumbsup:


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## Spencer (Jul 6, 2005)

Inner10 said:


> He certainly didn't sugar coat it but what he said is right on the proverbial money.
> 
> When I started my company it was like buying my first house, I felt like the first few months I did nothing but throw money out in the wind, then load up my credit cards.
> 
> The most important tool in business is working capital, some jobs you will throw out tens of thousands of dollars and not get a penny back for months. If you sink yourself before making your first material purchase you may find yourself low on credit.


I've been talking with the bank. I think I can keep things a float on what cash I have. It will be tight but I think it will be good because it will keep me on my toes with my pencil sharp. 

I am debating about whether or not to set up a line of credit should I need it. It would cost me $650 to get it set up. Then I could just use it as needed. Right now I don't plan to but the option is there should I need it. It would be strictly for working capital to keep jobs going not to use personally.


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## Spencer (Jul 6, 2005)

pinwheel said:


> Don't let em get to ya spenser. You're a sharp kid with a good head on your shoulders & a lot of ambition & hustle. You're gonna land on your feet man. But you've got some hard times ahead of ya. Getting started on your own is gut wrenching & nerve wracking. Get used to not getting a lot of sleep. When the jobs aren't lined up & the bills are still coming in, you won't sleep much, trust me on this, been there.


Thanks Pin, I'm gonna really be in for it because I'm already not sleeping. Had a four hour trip one way to get the van in Chicago. Dealer took forever to get the thing ready. Ended up heading out in rush hour traffic. Trying to keep my wife behind me in the car. Stress level off the charts. She stayed on me like a champ. Ended up making it back about midnight. Tired as a dog. Woke up at 3:30 this morning with to much on my mind to go back to sleep. Once I get in gear I have a hard time getting out. Tylenol PM can be a real blessing. Thanks for the kind words.

One of the things I admire about old timers is it seems like they all have that story about the hard times. When times were tough and you worked your tail off to make ends meet. But see the satisfaction as they share those stories lets you know that it is worth it. Hopefully we will have a good story to tell someday.


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## Inner10 (Mar 12, 2009)

Spencer said:


> I've been talking with the bank. I think I can keep things a float on what cash I have. It will be tight but I think it will be good because it will keep me on my toes with my pencil sharp.
> 
> I am debating about whether or not to set up a line of credit should I need it. It would cost me $650 to get it set up. Then I could just use it as needed. Right now I don't plan to but the option is there should I need it. It would be strictly for working capital to keep jobs going not to use personally.


If you are working for homeowners then you won't have to float much.


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## BamBamm5144 (Jul 12, 2008)

What kind of line of credit costs money to obtain?

Until you quit your day job you won't really have a grasp on what you need to do to succeed. Give your two week notice and start pounding the pavement. Don't be shocked to learn you only made $10 a hour on some jobs.

Good luck.


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## Spencer (Jul 6, 2005)

Inner10 said:


> If you are working for homeowners then you won't have to float much.


That is my thinking also. A friend of mine who has a stonescape business got his rolling from nothing by using fixed pricing and asking for half down.


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## SectorSecurity (Nov 26, 2013)

BamBamm5144 said:


> What kind of line of credit costs money to obtain?
> 
> Until you quit your day job you won't really have a grasp on what you need to do to succeed. Give your two week notice and start pounding the pavement. Don't be shocked to learn you only made $10 a hour on some jobs.
> 
> Good luck.


When I worked for a bank I saw this all the time lines of credit people paid to setup, if they were a good customer the bank usually waived the fee.


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## Spencer (Jul 6, 2005)

BamBamm5144 said:


> What kind of line of credit costs money to obtain?
> 
> Until you quit your day job you won't really have a grasp on what you need to do to succeed. Give your two week notice and start pounding the pavement. Don't be shocked to learn you only made $10 a hour on some jobs.
> 
> Good luck.


Home equity. Don't plan on going that route but just wanted to know what was there should I want it. The $650 is for fees associated with writing the loan/appraisal.


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## BamBamm5144 (Jul 12, 2008)

Spencer said:


> Home equity. Don't plan on going that route but just wanted to know what was there should I want it. The $650 is for fees associated with writing the loan/appraisal.


Do you have any money saved up otherwise?


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## Inner10 (Mar 12, 2009)

BamBamm5144 said:


> Do you have any money saved up otherwise?


He just spent it on a van.


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## Spencer (Jul 6, 2005)

Inner10 said:


> He just spent it on a van.


Which is why I wanted to finance the van in the first place.


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## mikeswoods (Oct 11, 2008)

You need to learn about 'payout schedules'

If your contract is written correctly you will be receiving payments at various points in any larger job.

I am seldom carrying a customer--50% now and balance at the end of the job? Don't do that---

Something like this works well,

Please sign and return with a deposit of $XX 
7 days before work starts a payment of $*** is required
When framing is complete $***
when electrical rough and plumbing is complete $XX
when drywall is hung $***
When trim work is complete $***

You see how this works? They aren't out way ahead of you--and you aren't bankrolling the job----

Most people like that arrangement---and you aren't putting yourself at great risk.


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## Spencer (Jul 6, 2005)

BamBamm5144 said:


> Do you have any money saved up otherwise?


I was figuring I'd have a solid 10k to start if I financed the van. I still have that option through my local bank. I may have to.

Running my numbers if I start out on March 1 I'd probably have 5k to get going. If we have time we can save more because my wife works. If I did it right now I wouldn't have squat.

My idea was to finance the van plus the few extra thousand that the bank could give me since I got such a deal on it. That would give me a comfortable amount of operating capital for the first few months. Then if things get rolling during the summer and I can get some more money saved up, pay the van off.


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## Inner10 (Mar 12, 2009)

Spencer said:


> I was figuring I'd have a solid 10k to start if I financed the van. I still have that option through my local bank. I may have to.
> 
> Running my numbers if I start out on March 1 I'd probably have 5k to get going. If we have time we can save more because my wife works. If I did it right now I wouldn't have squat.
> 
> My idea was to finance the van plus the few extra thousand that the bank could give me since I got such a deal on it. That would give me a comfortable amount of operating capital for the first few months. Then if things get rolling during the summer and I can get some more money saved up, pay the van off.


Sounds like you are in good shape. :thumbsup:


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## Spencer (Jul 6, 2005)

I guess in my mind it makes more sense to have a $200/month payment on a van and 15k in the bank vs van paid for and struggling to keep things rolling.


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## BamBamm5144 (Jul 12, 2008)

Spencer said:


> I was figuring I'd have a solid 10k to start if I financed the van. I still have that option through my local bank. I may have to. Running my numbers if I start out on March 1 I'd probably have 5k to get going. If we have time we can save more because my wife works. If I did it right now I wouldn't have squat. My idea was to finance the van plus the few extra thousand that the bank could give me since I got such a deal on it. That would give me a comfortable amount of operating capital for the first few months. Then if things get rolling during the summer and I can get some more money saved up, pay the van off.


Is your insurance downpayment paid out of that yet? Licensing? What about material costs?

You're in a fortunate situation where you have a job. I wish I had that when I got going. Don't jump in the water before you're ready to swim. I basically spent 5k before I even talked with my first potential customer.


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## Spencer (Jul 6, 2005)

BamBamm5144 said:


> Is your insurance downpayment paid out of that yet? Licensing? What about material costs?
> 
> You're in a fortunate situation where you have a job. I wish I had that when I got going. Don't jump in the water before you're ready to swim. I basically spent 5k before I even talked with my first potential customer.


I am trying to get my start up costs behind me right now. I've got the quote for my liability at $650 yr for 1 mil. Other than that, I'm getting quickbooks pro setup, contracts arranged, tools organized, might letter the van, etc.

If I had work lined up I would start now. Problem is with my current employer I'm afraid that when I say I plan to quit and start my business this spring, as soon as he lines someone else up to take my place he will say you might as well start now. For that reason, I can't advertise that I'm going to be full time. Its a tricky situation but it will work out one way or another. I'm just going balls to the wall right now getting things lined up. I turned down a bunch of work this winter but haven't had anything come up lately.


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## Inner10 (Mar 12, 2009)

Spencer said:


> I guess in my mind it makes more sense to have a $200/month payment on a van and 15k in the bank vs van paid for and struggling to keep things rolling.


Doesn't make a difference, go with whatever means of financing has the lower interest rate. Owning a van and paying interest on a line of credit is the same as financing a van and buying other items in cash.


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## pathway (Jan 9, 2014)

I'm assuming Spencer, you're focussing on the smaller, home improvment type jobs, 1 -2 weeks max for starting out since 5-10k is more a personal savings than any meaningful operating cash if you were to look at doing anything larger. Correct me if I'm wrong, you envision doing a 5 day job, get paid, do another one, get paid & so on till you establish a more appropriate amount of working capital/ credit ? My best advice, learned the hard way, get to know the quickbooks inside out & understand financial statements as well as you know your trade. I wish you well in your venture.


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## Spencer (Jul 6, 2005)

pathway said:


> I'm assuming Spencer, you're focussing on the smaller, home improvment type jobs, 1 -2 weeks max for starting out since 5-10k is more a personal savings than any meaningful operating cash if you were to look at doing anything larger. Correct me if I'm wrong, you envision doing a 5 day job, get paid, do another one, get paid & so on till you establish a more appropriate amount of working capital/ credit ? My best advice, learned the hard way, get to know the quickbooks inside out & understand financial statements as well as you know your trade. I wish you well in your venture.


Exactly. 

Thanks for the advice. Quickbooks pro actually arrived on my doorstep yesterday along with a book on using it.


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## Spencer (Jul 6, 2005)

On a side note. The boss actually came back today and asked about sitting down to talk about the future. I told him I had to be honest with him and told him where my heart was at. He took it really well. Said I'd have a job as long as I wanted it. 

This was a very big and very positive step. Knowing I have a job for the next couple months while I line up work is huge.


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## svronthmve (Aug 3, 2008)

Spencer said:


> On a side note. The boss actually came back today and asked about sitting down to talk about the future. I told him I had to be honest with him and told him where my heart was at. He took it really well. Said I'd have a job as long as I wanted it.
> 
> This was a very big and very positive step. Knowing I have a job for the next couple months while I line up work is huge.


Is he truly a man of his word?


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## Spencer (Jul 6, 2005)

svronthmve said:


> Is he truly a man of his word?


Like a father to me. One of the people I am closest to in life. Not perfect, but yes, he is trustworthy and wouldn't leave me out to dry unless I deserved it.


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