As your business grows and expands or as your business ages the need to replace or upgrade the equipment will become an issue for any business owner. This equipment can include large manufacturing equipment, company vehicles or heavy equipment or even office equipment. Sometimes the need to upgrade and replace equipment comes at a time when you don’t have enough funds in the company profit column. When this happens you have the option to turn to lenders that offer equipment financing.
Not all banks and financial institutes offer equipment financing, especially if you have limited equity in your business. On the other hand they may offer equipment financing but charge incredible high interest rates as they see it as a risky loan. To avoid these issues you may want to consider doing business with a lender that specializes in providing these types of loans to small businesses just like yours.
Check Your Personal Credit Score and Your Business Credit Rating
Credit scores and ratings, either personal or business, will most definitely have either a positive or a negative impact on your ability to get equipment financing. The better your personal credit score and your business credit rating is the easier financing will be and the better interest rates you will be offered.
Go back and check both your personal credit score and your business score and make sure all irregularities or discrepancies are taken off the reports. This can take months so staying on top of this quarterly is always your best option.
Consider Loan Length and Terms of Financing
It is important to be a conscientious consumer and check out different companies and the rates they offer with their equipment financing loans. You should also sit down prior to doing this web browsing and look at your repayment options. Typically the faster you can pay off the loan the better rates you will get and the lower total amount you will pay. This is because you are paying of the principal and interest much faster so the total loan amount is less.
However, you should also consider repayment of equipment financing loans realistically. You don’t want to agree to a repayment amount that is more than you can pay and still make a profit. You also don’t want skip payments or make partial payments as these will impact your credit rating and score.
We can help with our equipment financing loans. For more information go to www.anchorbanc.com.
