6 Myths About Equipment Financing to Ignore
While equipment financing remains a popular way to receive heavy-duty construction equipment and specialized equipment for a variety of industries, there are a surprising amount of myths surrounding this financial option. Don’t let these rumors fool you; here are six myths about financing that aren’t true and should be ignored.
Committees are Required to Approve Loans
While many banks use committees to reduce the risk of financing, not all companies operate this way. Many equipment loans can be approved in just a few hours and require no committee meetings to discuss.
Old Equipment Won’t Receive Financing
Some equipment runs the risk of obsolescence, but other equipment options retain their value for years. Don’t worry about financing older equipment if it still holds its value. Many financing companies allow you to receive any equipment you wish, whether it’s old or brand new.
Financing Requires Financial Statements
If you don’t have stellar financial statements or tax returns, choose an equipment financing provider that doesn’t require these documents. Not all loans require this financial information, particularly smaller loans. Avoid the additional time and scrutiny by choosing a financing company that doesn’t ask questions about your financial history.
You Can’t Receive Financing for Taxes
Costly taxes and licensing can turn many businesses away from the idea of even financing equipment. Choose a lender who is willing to offer TTL, or tax, title and license financing as well. You should be able to 100% finance your equipment, so don’t worry about saving up money for these hidden fees.
Financing Equipment Requires Collateral
Another roadblock to financing is collateral. Some banks feel the equipment itself isn’t enough collateral, so they require a large down payment and additional assets as collateral. Don’t be tricked into spending all your working capital on financing. For most equipment, you shouldn’t need to offer additional collateral.
You’ll Need a Down Payment
Just like myth number five, a down payment is also an unnecessary feature of many financing options. Keep your cash in hand and look for a financing option that allows you to start operating your business with no money down.
From commercial vehicles to computer software, receive the latest equipment you need with competitive equipment financing. Don’t be fooled by these six myths, but turn to a competitive provider of financing today and discover how you can successfully start or grow your business with less risk and your necessary high-quality equipment.