Equipment Financing FAQs
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Here are answers to the most common questions about Equipment Financing. You can explore our Blog Posts. If you still need assistance, please get in touch with us!
What is equipment financing?
Equipment financing is a type of loan or lease specifically for acquiring machinery, technology, vehicles, or other essential tools that support a business’s operations. Rather than paying the total cost upfront, businesses can spread the cost over time, which helps maintain cash flow while securing critical assets.
What are the standard terms for equipment financing?
Equipment financing terms typically range from 24 to 72 months. The term length can vary depending on the type of equipment, loan amount, client credit worthiness, and specific lender policies, ensuring flexibility for different business needs.
What are your funding limits?
Most of our projects are in the $1 million to $50 million range. However, we are willing to consider smaller projects around $500,000 as long as there is a path to future funding opportunities.
Do you work with other lenders and private equity firms?
ABSOLUTELY, our network of lenders is extensive as we have proven ourselves to be reliable, knowledgeable, respectful of their client relationships, and most importantly, able to fund projects that the bank, credit union, family office, or private capital were not able to.
What credit score is required for equipment financing?
While many lenders prefer a credit score of 650 or higher, Equipment Leases Inc. works with businesses across a range of credit profiles. They consider factors beyond credit score, such as the overall health of the business and their industry, cash flow, and the equipment’s value, making financing accessible even for companies with lower credit scores.
How can I increase my chances of obtaining equipment financing?
A solid business plan, strong cash flow, up-to-date financials, and clear justification for the equipment purchase can help improve your chances. At Equipment Leases Inc., we offer personalized solutions, even for businesses with less-than-perfect credit. We help you navigate the process to find terms that work best for your business.
What interest rates can I expect for equipment loans?
Interest rates for equipment loans can vary based on factors like credit score, equipment type, and loan terms, typically between 8% and 18%. Equipment Leases Inc. is committed to offering competitive rates for your unique situation, helping balance affordability with cash flow needs.
How long can you finance equipment?
Equipment financing terms generally range from 1 to 6 years. Factors such as equipment type, cost, and projected lifespan will influence the loan duration, providing flexible options to align with your financial and operational goals.
Can I finance both new and used equipment?
Yes, equipment financing is available for both new and used equipment. Financing used equipment can be a cost-effective solution, especially if it still has a strong operational lifespan. Equipment Leases Inc. works with businesses to secure financing for both new and used items to best suit their needs.
What types of equipment can be financed?
Most types of essential business equipment can be financed, including heavy machinery, office technology, medical equipment, construction tools, agricultural machinery, transportation, and specialized industrial tools. Equipment Leases Inc. offers industry-specific financing solutions across various sectors to meet your needs.
Is a down payment required for equipment financing?
No, we traditionally finance 100% of the equipment costs and include soft costs such as transportation, engineering, installation, and more. At Equipment Leases Inc., we offer flexible options to minimize upfront costs and help you acquire equipment without straining cash flow.
How does equipment leasing differ from financing?
Leasing allows businesses to use equipment without owning it outright. At the end of the lease, companies may have options to renew, return the equipment, or purchase it at fair market value. Financing, on the other hand, typically leads to ownership once the loan is fully paid off. Both options have unique benefits, and Equipment Leases Inc. can help you determine which is better suited for your business.
Can equipment financing help with tax benefits?
Yes, equipment financing often comes with tax benefits. Lease payments or loan interest may be tax-deductible as business expenses. Specific tax benefits can vary, so it’s advisable to consult a tax professional to understand how equipment financing might impact your tax situation.
How quickly can I get approved for equipment financing?
Approval times vary by lender but can be as fast as 24 to 48 hours. Equipment Leases Inc. has streamlined processes designed to help you get the financing you need quickly so you can acquire essential equipment and move forward with your business plans.
Why should I consider Equipment Leases Inc. for equipment financing?
Equipment Leases Inc. offers personalized equipment financing solutions tailored to your industry and financial needs. With a flexible approach to credit and loan terms, competitive rates, and a commitment to helping businesses succeed, we strive to make the financing process straightforward and beneficial for your business growth.
Do you work with other equipment brokers?
YES, we love our broker partners and the projects they bring to us. We currently have a very large network of brokers that bring us fantastic projects we would never have seen had we not developed a strong connection with their broker.
What is meant by Chapter 11?
Chapter 11 bankruptcy is a legal process that allows businesses or individuals to reorganize their finances under court supervision. Often called “reorganization” or “rehabilitation” bankruptcy, it gives the debtor a chance to restructure their assets and debts, making it easier to manage payments while staying in operation. This option can help businesses keep running as they work to improve their financial situation.