At some point in your business’s lifespan, you’ll need to purchase or upgrade your equipment. When that time comes, you will almost certainly need to take out an equipment loan to cover the costs. An equipment loan can be used to purchase medical equipment, kitchen ovens, chairs, tables, computers, and anything else that your small business might need to operate. Most lenders that provide equipment loans offer flexible payment plans, and many will cover around 25 percent of “soft costs”. Such as delivery charges and fees.
Equipment loans can be a major lifeline for a small business. However, as with any form of financing, you want to make sure that you will be approved for a worthwhile loan when you need it. These tips should help you with that.
Have Good Credit
First of all, you’ll need to make sure that your credit is in good shape. Things like late payments and other loans in default will work against you when you need to finance new equipment. So try to take care of as much of this as you can. This goes for your personal credit history as well as your business credit history.
Show that You Have a Solid Business Plan
You’ll probably have a better chance of being approved for an equipment loan if you’ve been in business for some time and only need to replace broken or obsolete equipment. If you need equipment to get a new business off the ground, you might have a harder time unless you can show that you have a great business plan in place.
Get Your Financial Records Ready to Go
Finally, have some cash flow statements ready to go when you meet with a lender. It’s part of showing that you have good credit and a business plan. Basically, anything that makes you seem less like a financial risk will work in your favor, so bring any documentation that proves that you have a steady cash flow and can repay your loan.
If you are in need of new equipment and you don’t have the funds on hand to purchase it, an equipment loan can be just the thing to keep your business afloat. For more information about how you can get a loan yourself, contact Rushview Commercial Funding today. We will be glad to answer any questions that you might have about financing your business.