Simple Interest Contracts Dealer Lending from Mission Financial
Mission Financial is proud to offer simple interest contract options to dealerships across the U.S. Our contracts are tailored to meet the unique needs of your customers, even those with minimal trucking experience and negative credit histories.
What is Simple Interest?
In a simple interest contract, customers have the chance to accrue little interest by paying their loan back in a quick an easy manner. Simple interest contacts calculate interest daily, based on what is still owed on the loan. When a customer makes a payment on the loan, their money first goes to the interest that has accrued that month. The rest of the payment then goes toward paying the principle of the loan. If the customer is able to pay off the interest each month without fail, that interest will not accrue for the next month.
On the other hand, if the interest is not paid by the end of each month, more interest will accrue on top of the interest from last month, which is known as compound interest. This means if payments are not made on time, the customer runs the risk of building up compound interest. This compound interest could mean the final payment of the loan is far higher than what was projected when the contract was first signed. However, it also means that if payments are made on time or earlier, the final payment could be even less that what was originally projected.
Option One for Dealership Lending
Mission Financial offers two simple interest contract options for dealership financing.
A tier one contract offers an 18.00 to 29.95 percent contract rate. On average, individuals finance between $20,000 to $40,000, however, up to $45,000 is available. This loan requires a down payment of 20-30 percent of the loan amount and a prepaid finance charge of 16 percent. The contract term is up to 42 months and extends to vehicles year 2000 and newer.
Tier 1 contracts are offered to truckers with at least three years of driving experience and with no repossessions or bankruptcies filed in the past year. Foreclosures are handled on a case by case basis. Tax liens and child support are acceptable in non-excessive amounts. Being an owner-operator, owning a home, or having prior truck credit are not required for a tier 1 contract with Mission Financial. For every contract, a loan doc fee of $495 is required.
Simple Interest Contract Option Two
A tier 2 contract offers drivers more time to pay their loan but also has stronger requirements for the driver and vehicle. Like the tier 1 contract, tier 2 offers up to $45,000 in financing principal, requires a down payment of 20 to 30 percent of the loan and a 16 percent prepaid finance charge.
However, tier 2 has a contract rate of 18.00 to 27.95 percent, a contract term up to 48 months and is only available to 2012 trucks or later. Tier 2 loans are offered to drivers with at least five years of trucking experience. However, truckers are not required to own a home, be owner-operators, or have prior truck loan credit. Unlike tier 1, tier 2 contracts require drivers to have no history of repossessions or bankruptcies. Foreclosures may be considered on a case by case basis, and non-excessive tax liens and child support are acceptable for a tier 2 loan. A $495 loan doc fee is required for all tier 2 contacts.
To learn more about Mission Financial’s contract options for dealerships, contact one of our customer service representatives in your region. We take pride in providing reliable contracts for all of our customers and would be glad to work with you every step of the way.