Business Loans for Food Trucks: Equipment, Commissary and Growth
Explore financing options for food truck businesses including vehicle and equipment loans, commissary costs, and working capital for expansion.
Financing Your Food Truck Business
Food trucks offer a lower barrier to entry than brick-and-mortar restaurants, but still require significant startup capital. A fully equipped food truck costs $50,000 to $200,000, plus ongoing expenses for commissary access, permits, insurance, and inventory. Understanding your financing options helps launch or grow your mobile food business.
The food truck industry generates over $1 billion annually and continues growing as consumers seek unique dining experiences and entrepreneurs pursue lower-risk restaurant concepts. Lenders have become more familiar with food truck business models, though options remain more limited than for traditional restaurants.
Startup Costs for Food Trucks
Food truck businesses require upfront investment across several categories.
| Category | Cost Range | Notes |
|---|---|---|
| Food truck (new) | $100,000-$200,000 | Custom built to your specifications |
| Food truck (used) | $50,000-$100,000 | May need upgrades and repairs |
| Equipment package | $10,000-$50,000 | If not included with truck |
| Permits and licenses | $1,000-$10,000 | Varies significantly by city |
| Initial inventory | $2,000-$5,000 | Food, packaging, supplies |
| Commissary deposit | $1,000-$3,000 | Required in most jurisdictions |
| Insurance | $3,000-$10,000/year | Vehicle + liability + workers comp |
| POS and technology | $500-$3,000 | Payment processing, social media |
| Working capital | $10,000-$30,000 | 3-6 months operating expenses |
Best Loan Products for Food Trucks
Several financing options serve food truck business needs.
| Loan Type | Best For | Amount Range | Typical Terms |
|---|---|---|---|
| Equipment/Vehicle Loans | Truck purchase | $50,000-$200,000 | 3-7 years, 7-15% |
| Microloans | Startup costs | $5,000-$50,000 | 2-6 years, 8-18% |
| Business Lines of Credit | Working capital | $10,000-$100,000 | Revolving, 10-25% |
| SBA Microloans | Startup/expansion | Up to $50,000 | Up to 6 years, 8-13% |
| Personal Loans | When business credit limited | $5,000-$50,000 | 2-7 years, 6-24% |
| Credit Cards | Small purchases | $5,000-$25,000 | Revolving, 15-25% |
Qualification Requirements
Food truck financing can be challenging for startups without established business history.
| Factor | Startup | Existing Business |
|---|---|---|
| Credit Score | 650+ (personal) | 620+ with history |
| Down Payment | 15-25% | 10-20% |
| Collateral | Truck as collateral | Truck + business assets |
| Business Plan | Required | Helpful |
| Food Experience | Highly valued | Track record matters |
| Personal Guarantee | Required | Usually required |
What Lenders Look For
Lenders evaluate food truck businesses on specific factors.
- Owner food service experience (restaurant, catering, culinary training)
- Realistic financial projections based on local market
- Clear concept and target customer identification
- Secured locations or events for regular service
- Health department compliance plan
- Commissary access for food prep and storage
- Marketing strategy for building customer base
Documenting relationships with event organizers, office parks, or regular locations strengthens your loan application by demonstrating predictable revenue opportunities.
Challenges and Realistic Expectations
Food truck businesses face unique challenges that affect financing.
- High failure rate for food businesses generally
- Weather dependency for outdoor sales
- Permit restrictions in many cities
- Equipment breakdown risks
- Fuel and maintenance costs
- Competition from other trucks and restaurants
- Limited financing options compared to traditional businesses
Food truck profit margins typically run 7-15% after all expenses. Build conservative projections that account for slow days, equipment repairs, and seasonal variations.
Example Scenario: Launching a Food Truck
Maria has 8 years of restaurant kitchen experience and wants to launch a taco truck. She has $40,000 saved and good personal credit (720). Her total startup budget is $130,000.
| Expense | Amount | Financing |
|---|---|---|
| Custom food truck | $95,000 | $75,000 equipment loan + $20,000 equity |
| Equipment additions | $12,000 | Included in equipment loan |
| Permits and licensing | $4,000 | Cash |
| Initial inventory | $3,000 | Cash |
| Commissary (3 months) | $2,000 | Cash |
| Working capital | $14,000 | $10,000 credit line + $4,000 cash |
Maria's equipment loan: $87,000 at 10% for 5 years = $1,848/month. With average daily sales of $800 over 22 operating days ($17,600/month) and 60% food/labor costs, she can cover debt service with margin remaining.
Ready to Roll?
Whether you are launching your first food truck or expanding to multiple units, financing options exist for food entrepreneurs with solid plans and preparation.
Apply to explore your options. We work with lenders who understand food service businesses and can help you build a sustainable mobile food operation.
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Read more →Important Disclosure
Not Financial Advice: The information provided in this article is for general informational purposes only and does not constitute financial, legal, or professional advice. You should consult with qualified professionals before making any financial decisions.
No Guarantee of Financing: Liminal Lending Co. is a business loan marketplace that connects borrowers with third-party lenders. We are not a lender and do not make credit decisions. Submitting an application does not guarantee approval or funding. Loan terms, rates, and availability vary by lender and are subject to borrower qualifications and lender criteria.
Third-Party Lenders: All loan products are offered by independent third-party lenders. Liminal Lending Co. is an Independent Sales Organization (ISO) and receives compensation from lenders for successful referrals. Terms and conditions of any loan are between you and the lender.
Rate Information: Rates, terms, and fees mentioned in this article are estimates based on publicly available information and may not reflect current market conditions or specific lender offers. Actual rates depend on creditworthiness, business financials, and lender policies.
Information May Change: Financial markets, lending regulations, and economic conditions are subject to rapid change. While we strive to keep our content accurate and up-to-date, information in this article may become outdated. Always verify current rates, terms, program availability, and regulatory requirements with lenders and official sources before making financial decisions.