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Need a new backhoe? Or a credit card processing app? There’s a loan for that. Seriously. There are small business equipment loan options for nearly every industry and every kind of kooky apparatus you need – which means your wish list is probably covered.
Equipment financing is a type of asset-based lending that helps business owners get the funding to purchase or lease equipment without depleting their working capital. Here’s how it works.
If your business doesn’t match some of the qualifiers below, it may be more challenging to receive funding from our lending partners.
TIME IN BUSINESS
Lendio’s mobile app can help get your business ready for financing. Open a business bank account, get cash flow insights and stay connected to get updated when you have offers available.
Sure, you can go the bank route with a long application process and 75% rejection rate. But if you’re looking for financing in this lifetime, Lendio offers a faster, easier application process.
It’s secured with bank-grade encryption and SSL technology, so you know your information is safe.
We pair you with loan options from our network of 75+ lenders. Our dedicated funding managers can help you weigh the pros and cons of each option.
Once you’re approved, you’ll be able to access your capital in as little as 24 hours.
Lendio carefully selects the lenders in its marketplace and then works with you to find the best equipment financing for your unique situation. Read on for stats on each lender and what each lender is best at.
Learn about our methodology for lender selection here.
Up to $500,000
4, 36, 48, or 60 months
Min. credit score
Time to funding
As soon as 1 day
Balboa Capital offers customers up to $500,000 in equipment financing. They do require some form of collateral for all of their financing options. However, if you use them for financing equipment less than $350,000, you’ll only need soft collateral.
Up to $20,000
As soon as same day
ClickLease offers equipment financing up to $20,000 with minimum credit requirements starting at 520.
One-time initial documentation fee
Up to $150,000
4 Hour Funding (Centra) specializes in equipment financing agreements or EFAs — a lease agreement in which the financier purchases the equipment up front and the borrower pays monthly installments until they own the equipment in full.
$275 doc fee
As fast as 1 day
Commercial Funding Partners offers equipment financing of up to $500,000 or more to small business owners. While you will need fairly good credit and at least 3 years of business under your belt to get approved, you may lock in flexible rates and terms.
Up to $1 million
Global Financial has provided equipment financing to small and medium-sized businesses in a variety of industries since 2009. You can get approved even if you have bad credit or a history of bankruptcies or tax liens.
$500 doc fee
Up to $5 million
Paradigm prides itself on individualized service, straightforward terms, and quick decisions. If you want to purchase a piece of equipment valued $10,000 or more, and don’t operate in a restricted industry, Paradigm is worth exploring.
Up to 10 years
South End Capital is a division of Stearns Bank and offers equipment financing for new and used equipment. You can get approved in hours and work with one of its Certified Lease Finance Professionals (CLFP) to find term and payment options that make sense for your small business.
Appraisal and environmental report fees
Up to $1.5 million
Based in Boston, Time Payment is a fintech company that’s owned by the affiliates of Fortress Investment Group, a top diversified global investment manager. Once you apply for its equipment financing solutions online, you’ll receive an instant credit decision for the maximum amount you can finance.
There are several places you can turn to when you’re looking for an equipment loan. Each one has its own strengths, so it’s all about finding the right fit for your business.
funded through us
lenders in our network
Sterling HannemannCo-Owner of Seven Brothers
Chloria ChandlerOwner of Bobbee O’s BBQ
Equipment financing is a financial solution that helps your business acquire the machinery, vehicles, or other equipment it needs to operate. Instead of paying the full cost upfront, you’re spreading the cost over time, making it easier on your budget.
Getting an equipment lease or financing can help you fund a variety of business needs. This financing solution can be used for things like:
Regardless of your company’s industry, exploring your equipment finance options could help the success of your business. Plus, equipment lenders usually report to business credit. The more business credit you build the greater opportunity you have in the future to receive the best rates and terms for the money you receive and increase your business’s ability to receive future loans without a personal guarantee.
The largest difference between an equipment lease and an equipment loan is that an equipment lease has a fixed term, in which you pay a monthly rental fee, with no prepay benefits, and an equipment loan can be paid off at any time with any remaining interest wiped clean.
There are multiple structures available for equipment leasing including:
Equipment financing is a type of funding that gives you full ownership of the equipment. You’ll pay interest in addition to the principal balance, usually as a fixed monthly payment. But once your financing term is over, you own the equipment free and clear.
Choosing the best equipment financing option depends on the type of equipment you need, how long you expect to need it, and how frequently you plan to update those assets. You can also use an equipment loan calculator to help you compare costs.
One of the biggest advantages of equipment financing is that it helps you grow your business with new equipment while spreading out the costs over time. Additionally, you often don’t need any collateral besides the asset itself. By integrating new equipment into your business, you could increase revenue and reach with your services.
A drawback is that funds can only be used for equipment and sometimes soft costs associated with the purchase, such as taxes or delivery fees. Other types of financing, such as a small business loan or business line of credit, have minimal restrictions on how you use the funding proceeds.
Pros of equipment financing
Cons of equipment financing
Your equipment financing payments are determined by four things:
These factors can vary widely across industries and equipment types. That’s why we work with a variety of lenders who specialize in industry-specific small business loans, so we can help you find the best deal.
Qualifying for equipment financing can actually be easier than other business financing options because the lender uses the equipment as collateral.
Equipment financing helps you scale your business without covering the full cost through your own cash reserves. Plus, the eligibility requirements are easier to qualify for since there’s physical collateral attached to the funding.
It depends on your lender and funding/financing terms. However, most equipment finance terms range between one to 10 years in length.
To get equipment financing, you’ll typically need to meet the following requirements:
And don’t worry if you don’t meet all of these requirements. Exact qualifications vary by lender and equipment type.
Yes, some equipment financing companies we partner with will work with startups from day one in business. Bear in mind that the financing company may place more stringent requirements on your personal credit score or only offer lower financing amounts if you have been in business less than one year.
Wondering how we chose the best? Here’s how we went about evaluating the lenders in our network.
*The information contained in this page is Lendio’s opinion based on Lendio’s research, methodology, evaluation, and other factors. The information provided is accurate at the time of the initial publishing of the page (November 28, 2022). While Lendio strives to maintain this information to ensure that it is up to date, this information may be different than what you see in other contexts, including when visiting the financial information, a different service provider, or a specific product’s site. All information provided in this page is presented to you without warranty. When evaluating offers, please review the financial institution’s terms and conditions, relevant policies, contractual agreements and other applicable information. Please note that the ranges provided here are not pre-qualified offers and may be greater or less than the ranges provided based on information contained in your business financing application. Lendio may receive compensation from the financial institutions evaluated on this page in the event that you receive business financing through that financial institution.
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