When it comes time for your company to seek financing for an equipment purchase, there are some things to be aware of which will help increase your chances of approval.
By observing some of the tips described below, you should have a better chance of being approved for equipment financing.
Equipment cost correlates to due diligence
Generally speaking, the higher the cost of any piece of equipment,, the greater will be the due diligence performed in investigating your company. Equipment which might be worth several million dollars will naturally trigger a more thorough investigation than something worth only a few thousand dollars.
Equipment sellers
It is always best to purchase your equipment from nationally recognized vendors, because that instills greater confidence in the lender. Brands which are well known for their quality have a better chance of being approved than lesser-known companies.
Equipment value
Equipment which depreciates relatively quickly is not nearly as appealing to a lender as equipment which retains its value over several years. Computer equipment for example, is notorious for losing most of its value during a three-year period.
Supplier payment history
Credit checks are always run by lenders when considering your company for possible equipment financing. One of the things they look for on this credit check is that you have paid your suppliers promptly, so make a point of keeping your payment history clean and on time with all of your vendors.
Company history
Even startup companies can secure equipment financing, although it’s a little harder than it would be for an established company. As a startup, you stand a much better chance of being approved, if you can demonstrate a good business plan, a good business model, a strong management team, and a good position in your market.
Equipment leasing with Proactive Funding Solutions
If your business needs financing to purchase an important piece of equipment, we may be able to help.
Contact us at Proactive Funding Solutions, so we can discuss some possibilities that might help you purchase the equipment you need to upgrade your business.
