What is an Equipment Loan?
Equipment loans are used to purchase business-related equipment, such as a restaurant oven, Long-Haul Trucks/vehicles or Heavy Duty Office machinery. As long as, it is essential for the business to run its daily functions. When you take out an Equipment Loan, you’ll need to consider committing to making periodic payments that include interest and principal over a fixed term. Read more below on some key factors of why an equipment loan may be the right type of funding for your business.
How to Qualify for an Equipment Loan?
Lenders will vary in their requirements to obtain an Equipment Loan. The following are general qualifications that lenders will look at when making a credit decision. However, underwriting standards vary and should be vetted before choosing a lender to ensure you meet their minimum requirements.
Your personal and business credit scores will be an important factor in obtaining equipment loans. If you’re unsure of your current credit score, you can find your personal and business credit scores online. The higher your scores, the more likely you are to get approved with better loan terms. Lenders prefer to see a 700+ credit score, and a 640 as a minimum.
In addition to credit score, lenders may require a business plan that describes your business and a detailed proposal for future growth. The basic goal is to give prospective lenders a comprehensive summary of your business. The number of years you’ve been in business and the annual revenue of your enterprise are important factors to include within your business plan.
Some lenders may be interested in your personal finances, resulting in submitting some personal documents as well. This might include items like past tax returns, bank statements or a list of all your personal debts.
Equipment Financing Pros
Pros of Equipment Financing
- Can help you build business credit
- Can be an affordable option, especially if you opt for a secured loan
- Can allow you to get the equipment you need for your business in order to grow
Frequently Asked Questions:
Is there a Down Payment for an Equipment Loan?
Gold Bridge Capital Solutions has an exclusive Equipment Financial Program that offers a 0% down payment required. See if you apply and for more information here >
What does an Equipment Loan Cover?
Equipment loans are commercial loans that allow you to access the equipment you need without paying for it up front. If approved for an equipment loan, you’ll be able to use the funds to cover the cost of the equipment and, in some cases, associated soft costs.
Equipment can include:
- Work Vehicles
- Long Haul Trucks
- Heavy Duty Office Equipment
- Office Equipment
- Office Furniture
- Machinery/Equipment essential to run your business
Can you use a SBA loan to buy equipment?
If the SBA 7(a) loan is what you’re looking for, then yes, you can use the SBA 7(a) loan for equipment purchases. It may be more difficult to go this route. It is sometimes easier to apply for an Equipment Loan than it is for an SBA loan.
If you are interested in Inquiring an Equipment Loan, you can Apply Here> or Contact us for more information.
Gold Bridge Capital Solutions
Phone: 916-236-5075 or 855-501-8725
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