The Basics of Equipment Financing
Most businesses will need new equipment at some point. Unfortunately, you won’t always have the cash available when it’s time to make those purchases. If you’re in a situation where you need new equipment to be able to make a profit but you don’t have the money to purchase it, then you’re going to want to look into equipment financing. If you’re new to this type of funding, here’s what you need to know.
Qualifying for Financing
If you’re about to look into equipment funding, then you probably want to know if you’ll qualify. The truth is that most businesses qualify. Now, the interest rate and how much you qualify for will heavily depend on your business, financial history and the type of equipment you are hoping to purchase. If you don’t have a great credit score, this can be the perfect type of financing.
Applying for Financing
The loan application isn’t difficult. Of course, it all depends on the equipment lender you work with. You will have to provide your credit score and proof of your business’s financial health. The document that you need will include the following:
- Voided business check
- Credit score
- Bank statements
- Equipment quote
- Business tax returns
One of the most important pieces of information that you can supply is the type of equipment you need help financing and the quote for how much it might cost.
Basics of Equipment Financing
If your business needs equipment but you don’t have the cash to afford it, then an equipment loan is a good move. You can use the money for any type of business equipment. Whether you need new computers or a new company car, it covers most equipment. In addition, how much you borrow will depend on the type of equipment that you buy. Your equipment serves as the collateral to secure the loan.
If you have a car loan, then you already have a good idea what to expect of an equipment loan. The price is what sets the standards. The price dictates how much money you can receive. One benefit you can count on is that you won’t have to put up collateral. Your equipment serves as collateral.
If you’re in need of new equipment to keep your business afloat but don’t have the cash flow to afford it, then you may want to look into equipment financing. Most businesses qualify and it’s an easy way to get the equipment you need without having to pay everything upfront.