Dreaming оf top-notch equipment financing tо boost your business’s revenue and profits? But what іf your budget feels like a roadblock? Worry not!
Canadian businesses can unlock their growth potential with business equipment loans from GreenBox Capital in Canada. GreenBox Capital offer flexible financing solutions tailored tо your specific needs, sо you can acquire the equipment you crave without straining your cash flow.
1. Know Your Needs
Sometimes businesses require specific pieces оf equipment tо launch оr stay competitive. However, the upfront costs оf top-of-the-line equipment can be a major hurdle, often demanding large cash investments оr payments. Luckily, acquiring such equipment through financing, like tо secure a business loan quickly, could be the difference between your company experiencing growth оr stagnation. This financing route allows you tо invest іn vital equipment without straining your cash flow, enabling you tо move forward with your business goals.
Loans secured by equipment can often offer more flexible terms than traditional small business loans or credit cards, and can often be tax-deductible as operating expenses.
Businesses must research all available options before applying for equipment loans and leases, since their choice will determine if they retain ownership, one-time fees or down payments requirements, interest rates that range between 5%-30%, application and origination fees that vary among lenders as well as whether any lenders require minimum credit scores or time spent in business requirements that may differ significantly than others.
2. Know Your Options
Your equipment financing options depend on your business needs and goals, for instance if you plan to acquire machinery that generates significant additional revenues (e.g. shipping more T-shirts monthly for $35 each), make sure your monthly debt payments do not outstrip anticipated increased earnings.
Lenders offer two forms of equipment financing: purchasing and leasing. When taking out a loan to buy equipment, this typically requires more of an initial down payment as well as monthly payments than leasing does.
Banks, credit unions and the Small Business Administration all offer equipment loans with favorable terms, rates and requirements. Other traditional equipment financing sources include online lenders like National Funding as well as invoice factoring providers and merchant cash advance providers – each has their own set of advantages and disadvantages; you can find information on them all in our guide to small business funding.
3. Find a Lender
When looking for equipment financing options for their business, business owners have several choices available to them. These options range from term loans and Small Business Administration options, to more specialized equipment financing solutions with varied loan terms and repayment schedules; which will work best depends on what equipment your organization requires to operate efficiently.
Equipment loans typically use your equipment as collateral against the loan, meaning if your monthly payments go unpaid the lender can take possession of it and repossess. Furthermore, lenders may request personal guarantees from you and place liens against other assets or real estate to ensure the loan will be repaid if its collateral cannot.
Loan providers who specialize in equipment financing may be more accommodating with regards to credit approval requirements, including accepting startups and those with poor credit histories. Still, it is advisable to thoroughly check both personal and business credit before applying for any type of business loan.
4. Apply for a Business Loan
Finance equipment to access flexible terms and lower interest rates as the lender assumes some risk in exchange for flexible terms and potentially lower rates; additionally it’s also an attractive solution for businesses that don’t have enough cash flow available upfront to purchase large purchases themselves.
However, financing equipment can be costly as you repay both principal and interest over time. Furthermore, depending on its depreciation schedule and purchase type there may also be tax implications associated with its financing agreement.
Consider whether an equipment loan is the appropriate funding solution for your business and how you plan on using it before settling on one. In Canada, GreenBox Capital’s fast and streamlined process compares 100+ lenders quickly so you can secure equipment loans quickly even with poor credit ratings.