With this type of financing, you’re able to fund the purchase of a piece of machinery, furniture, vehicle or another resource for your business — from commercial ovens, tractors and construction vehicles to computers, desks and office supplies.
You can receive up to 100% of the equipment’s value through business equipment financing. For risky investments, such as items with a high rate of depreciation, lenders may require a 10%-20% down payment.
The amount of funding you receive is determined by what your business qualifies for, as well as the price and condition of the equipment you’re planning to purchase.
With most equipment financing programs, the equipment itself secures the funds. As a result, it’s possible to get equipment loans or leases even if you have fair credit.
Equipment Financing Rates and Terms
Some lenders offer equipment financing rates starting around 8% with terms that can range from 1-5 years. The length of your agreement largely depends on the useful life of the financed item.
For instance, you can expect a longer-term on a commercial equipment loan or lease if you’re financing a truck or piece of construction equipment versus computer equipment that will become obsolete within a few years.
Payments are made daily, weekly or monthly, depending on the specifics of your agreement.
|Typical Business Equipment Financing Terms*|
|Loan amount||Up to 100% of equipment value|
|Rates||Can range from 8% to more than 20%|
|Repayment terms||1-5 years|
*Terms can vary by lender and borrower qualifications