Equipment costs for a new startup can be significant and daunting. Fortunately, there are several types of equipment financing options that can help. The funding solution that is best for your business depends upon factors like the amount you need to borrow, your credit score and more. Non-bank alternative lenders are more flexible with lending requirements than major banks and make a great option for startups.
Flexible Financing Options for Business Equipment
- Equipment financing: Using the equipment you’re buying as collateral, you could get 100% equipment loan, with up to a 10-year repayment period. Some lenders may require up to 20% down payment, while others may offer no down payment loans to qualified borrowers. Equipment financing offers quick funding within a few days, even for new startups–and when the loan term is up, you own the equipment.
- Deferred payment options: Some loans may feature a delayed first payment, with the due date up to 90 days in the future, so that the equipment can bring you some income before you begin paying for it.
- SBA 504 loans: These loans can be used for equipment and/or commercial property. This type of Small Business Administration-guaranteed loan provides up to $5.5 million and up to 20 years to repay. Personal collateral may be required, in addition to the value of the equipment you’re buying. Loan interest rates are capped at a limited amount over existing Treasury bond rates.
- Equipment lease: In this equipment financing option, you essentially rent the equipment while using it. At the end of the lease term, you can opt to buy the equipment, continue to lease, or return the items.
You can also consider financing pre-owned equipment in good condition to help you save money on your startup. Ask your lender if this is an option.
Contact Purevue Capital to learn about our flexible business equipment financing options, today.