Automotive & Equipment
Business Funding for Towing Companies
Towing companies need expensive trucks, and a single new flatbed or wrecker costs $60,000 to $250,000 depending on the capacity. You also need to cover fuel, insurance, and drivers around the clock if you handle police rotation or motor club calls. Cash flow is uneven because motor club companies pay low rates and take 30 to 45 days, while private tows pay cash at the time of service.
Common Uses
What Towing Companies Use Funding For
- Purchase flatbed tow trucks, medium-duty wreckers, and heavy-duty rotators
- Cover commercial auto insurance premiums that run $8,000 to $20,000 per truck per year
- Fund impound lot improvements including fencing, lighting, and security cameras
- Hire and train additional drivers to handle overnight and weekend dispatch
Funding Options
Best Funding Types for Towing Companies
Commercial Vehicle Financing
Finance tow trucks specifically with the vehicle as collateral. Towing industry lenders understand the resale value of Jerr-Dan, Miller, and Century equipment and can fund both new and used units with competitive terms.
Revenue-Based Financing
Repayments flex with your monthly revenue, which helps towing companies that experience seasonal fluctuations. Winter months bring more calls in cold climates, while summer can be slower.
Business Line of Credit
Maintain a credit line for fuel, insurance premiums, and truck repairs. Towing companies burn through fuel fast, and a major transmission or hydraulic repair can cost $10,000 or more without warning.
What Lenders Look For
Qualification Notes for Towing Companies
Related Industries
Related Automotive & Equipment Funding
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