Hoping to boost business growth with some new technology, heavy duty machinery, or anything in between? An equipment loan might be a good option for you.
What is an Equipment Loan?
As the name suggests, an equipment loan is a form of small business financing that is used specifically for equipment purchases. If you don’t want to purchase an item upfront, you can use the funds from the loan to expense the cost and then repay the principal over a longer period of time. That way, you can divide up the cost into more manageable payments.
How Equipment Loans Work
An equipment loan is just that – a loan. You’ll receive a lump sum in your business account that requires repayment on a regular basis, typically monthly. The cost of borrowing funds will depend on the amount, APR, and term length. To determine your monthly payment, you’ll need to be clear on all associated rates, fees, and obligations, so a loan calculator can come in handy.
Many times, the piece of equipment will act as the collateral and secure the loan but be sure to check with your lender about specific application requirements.
Unlike an equipment lease, you’ll have the opportunity to purchase the equipment. Once you repay the loan, the equipment is yours to keep. For equipment that will last your business an extended period of time, an equipment loan could be a great option to consider.
How to Apply for an Equipment Loan
Did you know SBA loans, the “gold standard” in the small business lending industry, can be used to make equipment purchases? If you choose SmartBiz for a working capital SBA loan, we’ll help you complete the streamlined, online application and match you with the lending partner most likely to approve your unique business.
With a long, 10-year repayment term, low interest rates, and 5-star service, a SmartBiz SBA loan can be taken out for amounts between $30,000 and $350,000. Get the funding you deserve as quickly as 7 days after completing the application! Learn more about equipment financing through SmartBiz here.
Interested in learning what factors go into making your business Loan Ready? Get started with SmartBiz Advisor today! This free, online, educational tool will provide you with personalized insights and recommendations to help you strengthen your lending profile, even before you start your loan application.
* The information provided through SmartBiz Advisor, including the Loan Ready Score, is for educational purposes and is not the same as scores used by lenders for credit decisions. SmartBiz Advisor is not a financial or legal advisor as defined under federal or state law. Use of this information is not a replacement for personal, professional advice or assistance regarding your finances or credit history.