Food Truck Financing: Best Loan Options, Costs & How To Get Approved

The food truck industry has exploded in popularity over the past decade, becoming one of the most profitable and accessible ways to enter the food business. Whether you’re launching a gourmet burger truck, a coffee van, or a dessert mobile, one challenge remains the same for all new owners: how to finance a food truck.

Purchasing the truck, installing equipment, securing permits, and covering operational expenses can quickly add up. That’s why understanding food truck financing options, approval requirements, and startup costs is essential for building a successful mobile food business.

This comprehensive guide explains everything—from loan types to approval steps—so you can get funded and launch your food truck with confidence.

How Much Does It Cost to Start a Food Truck?

Starting a food truck typically costs between $50,000 and $150,000, depending on location, truck size, equipment needs, and permits. Below is a detailed breakdown of where your money goes:

1 Food Truck Purchase Costs

The truck itself is your biggest expense.

• Used Food Truck: $40,000 – $70,000

• New Food Truck: $80,000 – $150,000

• Custom-Built Truck: $120,000+

The cost varies based on size, design, new appliances, and customization like branding, generators, storage, and layout.

2 Equipment & Build-Out Costs

Inside the truck, you’ll need high-quality commercial appliances such as:

• Grills, fryers, ovens

• Exhaust hoods

• Refrigerators & freezers

• Water tanks and plumbing

• Counters, storage & POS systems

Typical cost: $20,000 – $50,000+

3 Licensing, Permits & Legal Fees

Every city has different requirements, but common fees include:

• Business license

• Vehicle permits

• Health department certifications

• Parking permits

• Insurance policies

Typical cost: $1,000 – $10,000 annually.

4 Operating Costs

Recurring monthly expenses include:

• Ingredients & food supplies

• Fuel

• Marketing & branding

• Staff wages

• Truck maintenance

• Commissary kitchen rental

• Payment processing fees

Most food trucks spend $2,000–$10,000 monthly, depending on operations.

5 Example Startup Cost Summary

Why You May Need Food Truck Financing

Most new food truck owners need financing for:

✔ High upfront truck purchase costs
✔ Equipment upgrades
✔ Repairs or maintenance
✔ Cash flow during slow seasons
✔ Hiring staff
✔ Expansion (second truck or new locations)

Financing allows you to start sooner without draining personal savings.

Best Food Truck Financing Options (2025 Guide)

Below are the top funding solutions for new and experienced food truck owners.

1 Traditional Bank Loans

Banks offer competitive interest rates but have harder approval requirements.

Pros:

• Low interest rates

• Long repayment terms

• Ideal for established businesses

Cons:

• Hard to qualify for startups

• Requires strong credit and financial history

Interest Rates: ~6%–12%

2 SBA Loans (Government-Backed)

The Small Business Administration offers loans that are perfect for food trucks:

✔ SBA 7(a) Loans

Best for large purchases like a new food truck or renovation.

✔ SBA Microloans

Loans up to $50,000—ideal for equipment or small trucks.

Pros:

• Lower rates

• Longer repayment terms

• Easier for small businesses to qualify

Cons:

• More paperwork

• Approval may take several weeks

3 Equipment Financing

You borrow money specifically to purchase the truck or kitchen equipment.

Key Benefit: The equipment itself acts as collateral.

Perfect for:

• Low-credit applicants

• Fast approvals

• Buying appliances or a truck

4 Business Line of Credit

A flexible revolving fund you can use as needed.

Best for:

• Repairs

• Fuel

• Inventory restocking

• Seasonal cash flow shortages

You pay interest only on the money you use.

5 Food Truck Leasing

Instead of buying, you lease a truck for a fixed monthly cost.

Pros:

• Low upfront cost

• Upgrades possible

• Great for testing a business idea

Cons:

• You don’t own the truck

• Long-term costs may be higher

6 Merchant Cash Advances

An advance based on your future debit/credit card sales.

Pros:

• Same-day approval

• Easy qualification

Cons:

• Very expensive

• Should be used only in emergencies

7 Personal Loans

You can apply for a personal loan if your business is new.

Pros:

• Fast approval

• Can be used for anything

Cons:

• Higher interest rates

• Affects personal credit

8 Crowdfunding & Community Funding

Platforms like Kickstarter or GoFundMe let you raise money from supporters.

Perfect for businesses with a strong brand or unique concept.

9 Small Business Grants

Some cities offer grants for:

• Food entrepreneurs

• Minority-owned businesses

• Women-owned startups

• Community economic development projects

Grants are free money, but competitive.

Food Truck Financing Requirements

Lenders evaluate several things before approving your application.

1 Credit Score

Most lenders prefer:

• 600+ for equipment financing

• 650+ for standard loans

• 680+ for SBA loans

Lower credit doesn’t disqualify you—it simply limits your options.

2 Business Plan

A strong business plan should include:

• Your menu

• Target market

• Brand strategy

• Revenue projections

• Cost analysis

• Competition research

• Launch plan

Lenders want proof your business will succeed.

3 Financial Documents

You may need:

• Tax returns

• Bank statements

• Business license

• Income proof

• Cash flow statements

4 Down Payment

Typically 10–20% for truck purchases.

5 Collateral

Many lenders use:

• The food truck

• Equipment

• Personal assets (sometimes)

6 Experience

Not mandatory—but restaurant or hospitality experience helps.

Step-by-Step: How To Get Approved for Food Truck Financing

Follow this roadmap for the highest approval chances:

Step 1: Calculate Startup Costs

Know how much funding you actually need.

Step 2: Check Your Credit

Fix errors and improve your score if needed.

Step 3: Prepare a Professional Business Plan

This increases lender confidence.

Step 4: Gather Required Documents

Keep everything organized.

Step 5: Compare Multiple Lenders

Look at rates, terms, and qualification rules.

Step 6: Apply for Prequalification

Doesn’t affect your credit score.

Step 7: Submit Full Application

Provide accurate details and proof of income.

Step 8: Review Loan Terms

Check interest rate, repayment schedule, and hidden fees.

Best Lenders for Food Truck Financing (2025 List)

Categories of lenders offering suitable loans:

✔ Banks

• Wells Fargo

• Bank of America

• Chase

✔ SBA-Approved Lenders

• Lendio

• SmartBiz

• Celtic Bank

✔ Online Lenders

• OnDeck

• BlueVine

• Kabbage

• Fundbox

✔ Equipment Financing Companies

• Balboa Capital

• Crest Capital

• Currency Capital

✔ Microloan Providers

• Kiva

• Accion

Each offers different approval requirements and rates.

Tips to Improve Your Financing Approval Odds

Here’s how to look more appealing to lenders:

• Increase your credit score

• Offer a higher down payment

• Add a co-signer

• Reduce existing debts

• Provide strong financial projections

• Build business credit

• Start with a smaller food truck and upgrade later

Alternatives to Traditional Financing

If loans aren’t the right fit, consider:

• Renting a food truck instead of buying

• Partnering with investors

• Buying into a food truck franchise

• Joining an incubator program

• Operating from a shared commercial kitchen

These options require less capital and less risk.

Common Mistakes When Financing a Food Truck

Avoid these costly errors:

• Borrowing more than necessary

• Not reading loan terms properly

• Underestimating monthly costs

• Choosing high-interest financing without comparing options

• Skipping a business plan

• Not preparing for emergencies

Smart planning prevents financial stress later.

Is Food Truck Financing Worth It?

Yes! Food trucks often have high profit margins and lower overhead than restaurants.

Food trucks typically generate:

• $150,000–$300,000+ per year for successful operators

• Break-even time: 12–24 months

With a strong concept and good location, financing can accelerate your path to profitability.

Conclusion

Food truck financing makes it possible to start or expand your business without draining savings. By choosing the right loan, understanding costs, preparing documents, and comparing lenders, you can launch a profitable mobile food business confidently.

Whether you're buying a new truck, upgrading equipment, or scaling operations, the best financing option will depend on your credit, budget, and long-term goals. With the right planning, your food truck dream can become a successful, thriving reality.

FAQs

1. How much do I need to start a food truck?

Most owners need $50,000–$150,000 depending on truck size and equipment.

2. Can I get a food truck loan with bad credit?

Yes—equipment financing, MCAs, and some online lenders accept lower credit.

3. What credit score is required for SBA loans?

Typically 680+, though some lenders accept lower with strong financials.

4. Are there grants for food truck startups?

Yes—local government and small business grants are available in many cities.

5. Is leasing better than buying?

Leasing has lower upfront costs but buying gives long-term ownership benefits.

6. How long does loan approval take?

Online lenders: 1–3 days
Banks/SBA: 1–4 weeks 

Read Also: Food Truck Business Plan: Costs, Equipment, Menu Ideas & Profit Tips (2025 Guide)