Truck Loans and Truck Title Loans | Loans Canada (2023)

Let’s say you own a truck driving company and are looking to add to your fleet. Or, maybe you’re looking to start a business and need a commercial truck. Finding the right type of truck financing is a key component of the financial success of your business. While taking on a truck loan isn’t as easy or affordable as financing a minivan or sedan, there are countless options for all Canadian business owners. With that in mind, here is everything you need to know about getting approved for a large truck loan in Canada.

Reasons Why A Truck Loan Is The Right Option For Your Business

  • Your current trucks are out of date and need replacing
  • You need to increase your fleet to keep up with demand
  • You’re starting a new business and a truck would be a great addition
  • You need financing to pay for repairs or upgrades

What Is A Truck Loan?

A truck loan is similar to a typical auto loan in that the vehicle acts as security for the loan. Payments are made by the borrower on a monthly basis and the borrower’s financial health is used to determine approval.

Truck loans are typically taken out by small business owners who either own a trucking company or who are looking to purchases a truck to help with transportation. Because of this, a lender will likely ask you to provide information about the financial health of your business.

Typically, the borrower should know which truck they want to purchase before inquiring about financing and should expect slightly higher interest rates than a typical auto loan. Because a truck is usually a business asset, lenders see truck loans as a riskier investment. Be prepared to provide additional information and documentation and always consider and compare all your options to find the best lender for your needs.

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Types Of Trucks That Can Be Financed

When it comes to choosing which type of truck you want, you’ll have what might seem like an almost endless number of options to go through. There are semi-trucks, box trucks, dump trucks, tow trucks, flatbeds, and the list goes on. With so many options, how do you choose the right one for you?

Really, the type of truck that you get depends on what you need it for. A person who is looking to become an owner-operator of a long-haul truck driver will have different needs than someone just looking to do some moderately sized local deliveries. The price of the truck will also differ depending on things like size, age, mileage, etc. Generally, the heavier a truck is, the more expensive it will be and the stricter the requirements of the loan or financing might be.

As far as financing goes, there is the option to lease your truck instead of purchasing, but it is generally a better and less complex option to simply get the loan and pay for it.

Truck Loans and Truck Title Loans | Loans Canada (1)
Truck Loans and Truck Title Loans | Loans Canada (2)
Truck Loans and Truck Title Loans | Loans Canada (3)
Truck Loans and Truck Title Loans | Loans Canada (4)
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Compare Providers of Truck and Transportation Financing

AmountInterestTerm (months)
Truck Loans and Truck Title Loans | Loans Canada (7)$1,000 - $300,000Fee-Based: Starting at 9%12 - 60More Info
Truck Loans and Truck Title Loans | Loans Canada (8)$5,000 - $300,0008% - 29%6 - 18More Info
Truck Loans and Truck Title Loans | Loans Canada (9)$5,000+4.9% - 24.99%18 - 48More Info
Truck Loans and Truck Title Loans | Loans Canada (10)$5,000 - $250,000-3 - 18More Info
Truck Loans and Truck Title Loans | Loans Canada (11)Up to $300,0008% - 22%6 - 12More Info
Truck Loans and Truck Title Loans | Loans Canada (12)$5,000 - $500,000-6 - 18More Info
Truck Loans and Truck Title Loans | Loans Canada (13)Up to $250,000--More Info
Truck Loans and Truck Title Loans | Loans Canada (14)$5,000 - $100,000+6.87%3 - 18More Info

How To Prepare To Apply For Commercial Vehicle Financing

Before submitting an application for any type of commercial vehicle financing, all business owners should make sure they have the following information and documents prepared. That way the process will go as smoothly as possible and you’ll be on your way to getting the financing you need.

Personal Documentation

As the business owner, most lenders will require you to provide at least a government-issued ID as well as your SIN. General information like your address, phone number, and email address, will also be required. If the lender is requiring you to personally guarantee your loan, you will also need to provide information and documents about your personal finances.

Business Plan

Most lenders want to know what you plan on doing with the money and how it will help you improve your business and grow your revenue. Generally speaking, if you own a business you should have some type of business plan written down. If you don’t, this is a great time to get started.

Revenue History & Proof of Income

Does your business bring in enough revenue to cover the cost of the financing you’re interested in without seriously affecting your working capital? In fact, most lenders will require you to have a minimum monthly income before even considering your application. To assess your business health, they’ll often require your bank statement, cash flow statements and other financial documents.

Proof of Assets

Do you own any business assets like real estate, equipment, or vehicles? If you plan on using any of your assets as collateral, proof of ownership, registration, and even licensing information will be required.

Down Payment

By providing an adequate down payment for the truck or other vehicle you’re looking to purchase, you’ll not only reduce your monthly cost but will also increase your chances of approval. The size of your down payment will depend on several factors, including but not limited to your loan size, the asset you’re purchasing, and even your credit history.

Additional Reading

Advantages Of A Truck Loan

  • You’ll Own The Truck – Each payment you make towards your truck loan will bring you that much closer to owning the truck. Once you own the truck, you can use it to get a truck title loan or sell it for profit in the future.
  • Tax Benefits – When you purchase a vehicle for business purposes, you can deduct certain expenses such as fuel costs, truck insurance, repairs and even interest paid on a truck loan.
  • Spread Out Payments – The main benefit of a truck loan is its affordability. Trucks can be very expensive, making it hard to pay off upfront. With a truck loan, you can spread the costs over several years.

Disadvantages Of A Truck Loan

  • Negative Equity – If the value of your truck depreciates faster than you can pay it off, you may end up with negative equity. This means you owe more on your loan than what your truck is worth. Lenders generally try to avoid this by financing only a portion of the truck.
  • Down Payment – As mentioned above, lenders generally dislike providing loans where the borrower may end up with negative equity. This is because it increases the lender’s risk. If the borrower were to default on the loan while they have negative equity, it’ll be harder for the lender to recoup payment even after seizing the vehicle. As such, many lenders will require you to provide a down payment.

Cost Of A Truck Loan

When financing a truck, you need to consider the cost of the loan. This includes the interest rate, term length, upfront payment and the overall loan amount. All these factors can affect the total cost of your loan. Below we’ve illustrated the cost of a basic truck loan.

Truck Value$60,000
Down Payment (20%)$12,000
Financing Amount (80%)$48,000
Interest Rate (APR)15.9%
Term Lenght5 years (60 months)
Monthly Payment$873.54
Total Paid$52,412.4
Total Interest Paid$16,412.30 ($4,412.30: interest + $12,000: down payment)

Already Own A Truck? Use It To Get A Loan

If you’re struggling to secure a loan to help grow your business, you can use a truck that you already own as collateral. This is called a truck title loan. These types of loans can not only help you get a larger loan but can also help you get a better rate.

What essentially happens is that the lender will take the title of your truck and use it to protect themselves in case you default on your loan. This is a great way to make yourself a more attractive applicant for a loan, but it can be risky, so make sure you consider all options and ensure you won’t miss any payments.

Of course, there are some requirements to be able to secure a title truck loan and use a vehicle as collateral.

  • You must own a big rig or similar large scale delivery truck that is in good working condition
  • The truck that is being used as collateral cannot have any liens on it
  • You must be 100% finished paying for the truck

If those are all good on your end, you will be able to take advantage of a truck title loan.

Benefits Of A Truck Title Loan

A truck title loan is a great option for all truck owners looking to take out a loan. Should you decide to apply for a truck title loan you’ll be able to take advantage of the following benefits;

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  • Lower interest rate
  • Approval rates are usually higher
  • Larger loans are available
  • Because it’s secured, lenders are typically less interested in credit scores

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Truck Loan FAQs

How do I get financing for a truck I want to buy?

When it comes to financing a truck, you have several options. A loan from a bank or credit union, an alternative online lender, or through a dealership. Which option you choose will depend on your financial situation, your credit history, and the type of truck you want to purchase.

Do I need good credit to get approved for a truck loan?

If you want to apply for truck financing through a bank or credit union, yes you will need average to good credit. A credit score above 650 should be enough. If you have a credit score that is less than 650, consider choosing an online lender or looking into your in-house financing options through a dealership.

Can I get a truck loan without a down payment?

A business owner may be able to qualify for zero-down financing. Typically the lender will require that the business is a minimum age, meets a certain revenue threshold and that you are able to provide proof of income.

What types of trucks can I get financed?

The types of trucks you can get financed are almost endless. Depending on the type of business you run, you can find financing for anything from a long-haul truck to a smaller delivery truck.

Purchasing A New Truck Or Big Rig?

While getting approved for a large truck loan in Canada might seem like an intimidating venture, it really isn’t all that much more difficult than a regular car loan. Sure, it is more expensive and there are rules, but as long as you buy within your budget and ensure you make the payments on time, you shouldn’t run into any sort of a problem. If you’re interested in applying for a truck right away, we can help! Fill out an application below.

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Vehicle Financing Glossary


Any features or services that are applied on top of the base price of a car are considered add-ons. These can include things such as tinted windows, heated seats, leather seats, alarms, and wheel locks, to name a few.

Base Price

The base price of a car is the cost of the vehicle without any upgrades or added features that can be added after the car is ordered from a dealership. Only standard equipment and the manufacturer’s warranty are included in the base price, but any other fees will be added afterward.

Certified Pre-Owned (CPO)

CPO cars refer to used cars that have been certified, either by the dealership selling the car or the manufacturer of the vehicle. This gives consumers confidence knowing they are buying a used vehicle that is in good condition. When a used car is obtained by a dealership, it is inspected by a certified mechanic. The car is then repaired if it meets the required standards and is then ready to be sold as a CPO vehicle.

Clear Title

A clear title means that the owner of the car has a free and clear title and no longer carries a balance owing on a car loan. There are no liens of the title or levies from creditors.


Auto dealerships are businesses that are authorized to sell new or used automobiles to consumers and serve as a direct dealer for automakers

Dealership Financing

Consumers can obtain dealer financing to help fund the purchase of a vehicle. A contract is signed with a dealership that requires a consumer to pay for a specific amount plus interest and funding fees over a certain period of time. Dealers will send the details of the consumer’s financials to various lenders to find one that will approve the loan.


Depreciation refers to the decline in the value of a vehicle. Immediately after purchase, a vehicle will become less valuable as soon as it is used. Put another way, depreciation is the rate at which an automobile loses its value over time

Extended Warranty

Vehicles come with a manufacturer’s warranty when purchased, but buyers can choose to purchase an extended warranty. This serves as a form of insurance policy on the vehicle to cover the cost of potential repairs in the future. An extended warranty is usually good for a certain period of time and/or mileage.


A contract that allows an individual the right to use or occupy a property for a specified period of time in exchange for a monthly payment. Leases are common for a property like apartments and vehicles. The individual on the lease does not own the asset at the end of the lease’s term, it is strictly for rental purposes.

MSRP (Manufacturer’s Suggested Retail Price)

Car manufacturers will offer recommendations on how much a car should be priced at the retail level, known as the manufacturer’s suggested retail price, or MSRP. The purpose of the MSRP is to standardize pricing in the automobile industry so that there is not a lot of fluctuation in price from one dealership to another.

Title Loan

A title loan uses the vehicle title as a form of collateral to secure a loan. Borrowers must own their vehicles free and clear and no longer owe any amount on a car loan. A lender will place a lien on the car title in exchange for funds. If the borrower defaults on the loan, the lender can take possession of the vehicle and sell it to cover any losses.

Trade-in Allowance

A trade-in allowance is the amount that a car dealer will reduce the cost of a new car purchase by after the consumer’s old vehicle has been traded in. It is somewhat like being given credit from the sale of an existing vehicle that is then applied to the purchase of a new vehicle.

Trade-in Value

A trade-in value is the amount that dealerships offer consumers for their vehicle and is typically applied toward the purchase price of another vehicle. Dealerships will assess the value of the vehicle and will base the amount that can be applied to a new car purchase. The consumer will then trade in the old vehicle and the assessed value amount will be deducted from the price of another vehicle. Trade-in value is often different than what the vehicle may be worth when sold in the open market.

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Vehicle Identification Number (VIN)

Every vehicle will have its own unique vehicle identification number, which is used to identify a specific vehicle. No two vehicles will have the same VIN, making them easily identifiable with this unique 17-character code.


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