Financing a Food Truck in a Tough Economy

Financing a Food Truck in a Tough Economy

food truck loan

Although food trucks are popping up across the country, some hopeful owners are still struggling to get financing, and this has many culinary entrepreneurs wondering how to go about getting the cash they need to either start or maintain their business.

These days you’re more likely to win at roulette than to secure a business loan. Nearly two-thirds of privately held businesses said they were denied by banks when they applied for a loan, according to a recent Pepperdine University survey. So many hopeful food truck owners have to get creative when it comes to raising money. Here are a few tips:

Bank Loans

Before you fill out that bank loan application, do some homework. If you are planning to use a bank loan to get your food truck operation started, run a credit check and talk to local bankers about the criteria needed to get a loan.

Then, make sure you have a solid business plan that includes details such as a competitive analysis, the management process, a marketing analysis and financial projections.

Also be aware that you will be expected to lay out more of your own cash up front. Banks used to settle for anywhere from 10 percent to 20 percent in cash or assets put up by those seeking a loan. Now they are looking for closer to a 50-50 split, the more money that comes out of your pocket the better.

Micro Loans

If you are looking for a loan under $50,000, a microloan may be the way to go.

The Small Business Administration’s Microloan Program provides small, short-term loans through specially designated intermediary lenders, which are usually nonprofit community-based organizations.

While the maximum amount is $50,000, the typical loan is for $13,000. The requirements to obtain a microloan are more lenient as far as your credit score goes, plus, many big banks are generally hesitant to approve loans for under $50,000.

Crowd Funding

Instead of heading to your rich uncle, look into the relatively new phenomenon of “crowd funding”. This type of loan is where you get small chunks of funding from everyone in a group such as Kickstarter.

This route has a lot lower risk for those involved. The other upside is you will have a lot of people with interest in your prospective food truck and they may be more likely to give you referrals and opportunities down the road.

What Not to Do

The “don’ts” can be just as important as the “dos” when it comes to financing your food truck business. Here are three pieces of advice on the subject.

First, don’t invest all your time in trying to raise money. There have been so many good business concepts that go sour because the person has committed everything to raising money and puts the concept on hold.

Second, ideas are great but execution is everything. Don’t pursue financing if you don’t have a working concept.

Lastly, don’t get hung up on the interest rate. If someone is offering you $50,000 at 12 percent and someone else is offering you $30,000 at 8 percent, the loan with the higher interest rate may be the way to go if that is the capital you need.


Richard is an architect by degree (Lawrence Technological University, Southfield, Michigan) who began his career in real estate development and architectural planning. In September of 2010 he created Mobile Cuisine Magazine to fill an information void he found when he began researching how to start a mobile hotdog cart in Chicago. Richard found that there was no central repository of mobile street food information anywhere on the internet, and with that, the idea for MCM was born.


  1. Discount Food Trucks offers 100% Financing Options and the opportunity to get Your Custom Food Truck or Cart on Road with a Shoestring Budget!

    We boast the lowest prices in the Industry along with Quality Craftsmanship, State of the Art Kitchens, AND Creative Designs!

    As a Mobile Food Consultant with Discount Food Trucks, we assist with Health department regulations, locating untapped markets, menus, and getting you operational within 90 days WITHOUT BREAKING YOUR BANK!!!

    Laura Burrell
    Mobile Food Consultant

  2. A friend of mine wanted to start a food truck (serving just organic, local food in Oakland) and used crowdfunding to raise $20k and it worked pretty well. He used a site called

  3. Kickstarter is an excellent place to start looking into food truck funding. However, it may not be the source where you’ll get 100% of the total funding you need. It appears that many use Kickstarter to help finish their truck build. That means using those funds for vehicle wraps, kitchen equipment, retrofitting an existing truck, etc.

  4. What this article fails to mention is that most, if not all traditional banks will not loan money to a “Startup” business, especially in the food service industry, let alone something on wheels. Pinnacle Leasing specializes in STARTUP businesses, INCLUDING food trucks! We can lease either the truck, the equipment inside, or both! Approvals are based on personal credit, financials generally not needed, and you don’t need 20%-30% down! Leasing in this economy is a great business decision, and we want to work with you!

    For more information please contact;
    Tod Siegel

    • I changed to a new company that has even more options than what I used to have – Centra Leasing – like I said above, if you already have the truck we can easily lease all the equipment inside – including the generator, HVAC system, POS, etc – most banks will not touch this! If you want to get into the food truck business, or expand and add this to your current location, leasing is a great option!
      Please contact me if you have any questions about what we can do for you.

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