Equipment Financing

At a Glance

Restaurants, manufacturers, hotels, tour companies – many businesses depend heavily on equipment to serve their customers. No matter how your amortize it, this equipment represents a high upfront costs that can be difficult to pay out of pocket. Equipment financing offers specific loans to buy equipment to help companies buy, expand, or replace their key operational assets.

Benefits & Drawbacks

Benefits:

-Straightforward loan for both lenders and businesses
-Increases your net value, revenue, and ultimately, your equity

Drawbacks:

-Very limited in scope – specific purchases must usually be approved
-Liens can be placed on the equipment purchased

Why Should I Think About an Equipment Loan?

Equipment loans are very targeted loans, designed for a specific purpose. From the start, you know what you want and how much money you need, which is an advantage. While equipment loans are present in nearly every industry, they tend to be used for particularly expensive purchases, like heavy machinery, a complete kitchen renovation, and so on.

Is an Equipment Loan Difficult to Apply For?

Equipment purchased yields immediate ROI and can even prove a source of collateral, which reduces the risk of this loan. That can make the application process much easier, but keep in mind that your credit score, experience, and business stability also play a part. Lenders will be interested in the type of equipment you want and why you need it as well.

What Do Equipment Loan Payments Look Like?

There's a particularly wide range of rates for equipment loans, because so many different arrangements are possible. You and your lender may decide on anything from no down payment to a 50% down payment. Rates can vary from 7 to 45 percent. Discounts may be available through specific loan programs as well. To get a clear idea of the costs, know specifically what equipment you need and discuss your situation with your lender.