Equipment Financing
Financing structured around the purchase of business equipment, where the equipment often serves as collateral.
Program overview
Equipment financing is used to acquire machinery, vehicles, or other business equipment. The financed equipment commonly serves as collateral for the transaction.
How it works
- The business identifies the equipment and obtains a quote or invoice.
- The provider finances all or part of the cost.
- Payments are made over a term often related to the useful life of the equipment.
- Lease and loan structures differ in ownership and end-of-term options.
Common uses
- Vehicles and trucks
- Manufacturing equipment
- Restaurant and kitchen equipment
- Technology and machinery
Who may be a good fit
- Businesses acquiring specific, identifiable equipment
What you may need
- Business bank statements
- Business tax returns
- Personal tax returns
- Year-to-date profit and loss statement
- Balance sheet
- Business debt schedule
- Government-issued identification
- Business formation documents
- Equipment quote or invoice
Potential advantages
- Collateral is built into the transaction
- Preserves working capital for operations
- Term often aligned to equipment life
Potential drawbacks
- Restricted to the equipment purchase
- Some structures include end-of-term buyout considerations
Application process
- Obtain an equipment quote
- Submit an application with financial documentation
- Review structure, term, and end-of-term options
- Closing and vendor payment
General qualification considerations
- Type, age, and resale characteristics of the equipment
- Time in business and revenue
- Owner credit profile
- Down payment where applicable
Alternatives to consider
SBA 504 LoansLong-term financing generally associated with owner-occupied commercial real estate and major fixed assets.Business Term LoansA lump sum repaid over a set period, commonly used for defined projects and one-time investments.Working Capital FinancingShorter-term financing used to cover day-to-day operating needs rather than long-term assets.
Frequently asked questions
Can used equipment be financed?
Many providers finance used equipment, but eligibility, age limits, and structure vary by provider and equipment type.
This is preliminary information, not an eligibility determination, offer, or approval. Final eligibility, terms, rates and approval are determined by the applicable financing provider.