Business Equipment Loans

Business Equipment Loan FAQs

What is a Business Equipment Loan?

• A business equipment loan allows business owners to borrow money for the purchase, repair or replacement of large-scale equipment.

How does a business equipment loan work?

• With a business equipment loan, the equipment is the collateral. If a business owner doesn’t meet the term agreements, the financing partner may reclaim the piece of equipment, but nothing else.

What is the difference between a business equipment loan and lease?

• For an equipment lease, the lender purchases it and leases it to you at a predetermined monthly amount. At the end of the month, the lender still owns the equipment. With a business equipment loan, you, as the business owner, purchase the equipment through a loan and pay it down every month with interest. At the end of the loan, you fully own the piece of equipment.

What sorts of equipment can I buy with a business equipment loan?

• From heavy machinery and company vehicles to manufacturing equipment, business equipment loans can be a great solution for purchasing, repairing or replacing large-scale business machinery.

How do I qualify for a business equipment loan?

• To qualify for a business equipment loan, lenders typically look at several factors:
  • Credit Score: Good personal and business credit scores.
  • Time in Business: A Florida-based business operating for a minimum of three years.
  • Annual Revenue: Minimum annual revenue requirements.
  • Down Payment: A down payment which is usually 10% to 20% of the equipment cost.

What are the typical terms for an equipment loan?

• Typical terms for an equipment loan include:
  • Loan Term: Usually between 6 months to 3 years.
  • Down Payment: Typically, 10% to 20% of the equipment cost.

Can I refinance my existing equipment loan to get better terms?

• Yes; you can refinance your existing equipment loan to potentially secure better terms, such as lower interest rates or extended repayment periods. By doing this, you can potentially reduce your monthly payments and improve cash flow.