You’ve been thinking about equipment financing lately and you’re excited to get started. But as you sit down to start Googling you realize there is a lot of information out there.
“How do I make sense of all this? Should I lease? Should I finance? How do I know what’s right for me?”
If you have a lot of questions about equipment financing, not to worry. Below we’re going to go over the basics of equipment financing and what you need to know to get started.
Research What You Need
The first step in any equipment financing process is to figure out what you need. You might have a good idea, but with all the brands out there it’s sometimes hard to know what’s worth all the hype and what’s not.
That’s where reviews come in handy. By looking at objective reviews of equipment you can get a better idea of brands to shoot for, and which ones aren’t worth it.
Do you have a medical practice and want the best medical supplies and equipment? Check out Very Well Health for some information on medical supplies and other equipment you might need, like wheelchairs.
Or maybe you have a restaurant and you’re thinking about adding an espresso machine? YouTube channels Whole Latte Love and Seattle Coffee Gear have in-depth reviews on many espresso machines, grinders, and other coffee supplies to ensure your restaurant serves the best coffee around.
“What if I’m looking for cooking equipment?” Try America’s Test Kitchen for reviews on kitchen tools like spatulas to appliances like blenders and mixers.
Leasing Vs. Financing
Okay, now that you have a pretty good idea of what you need, the next thing to go over is the difference between leasing vs financing.
Leasing: You don’t own the equipment. Much like leasing an apartment, you’ll pay a monthly fee. Some leasing companies have the option of buying the equipment at the end of the lease.
The bonus leasing is that you’re not locked into ownership. If at the end of your lease you want to move on to better equipment, you can.
Financing: Financing is where you’ll own the equipment. You’ll make a monthly payment as you would with a lease, only the payment is going towards owning the equipment outright. You will also be responsible for the repairs the equipment might require and store it after a completed job.
“So, What’s Right for Me?”
Good question! The answer to this mainly depends on how often you plan to use the equipment.
For example, if you’re a restaurant owner who only plans to serve your homemade ice cream during the warmer parts of the year, leasing an ice cream maker makes much more sense. The same goes for any equipment you use seasonally. No matter what industry you’re in, if you’re not planning on using the equipment year-round, leasing is always best.
Leasing is also perfect for trying out new equipment. Let’s say there is a new piece of equipment your industry is raving about. It appears to be super helpful and keeps everyone productive. If you’re not sure if you’d like to buy, or just want to see for yourself how great this equipment can be, lease it. This way, you can put this new device to the test and then decide at the end of the lease if it’s worth financing.
However, if you plan on using the equipment all year, financing is the better way to go. If you treat the equipment well and practice good maintenance, costly repairs aren’t likely to happen. Financing is also best if know what you want, and the tools are multipurpose.
Take, for example, the grapple boom truck. Not only is a grapple boom truck great for clearing out debris and waste after a large storm, they can also be used to clear out unwanted materials after a home or office remodel. With a tool, this useful financing can save you money in the long run.
To learn more about whether to rent or buy, click here.
The Best Places to Get Equipment Financing
By now you might be wondering, “Where could I get the best financing? And what rates can I expect?”
This is a common question people have, and for good reason. They want to get equipment financing at rates they can afford.
The truth is the rates you get are based on your business situation and your situation only. A friend might come to you and say they’ve gotten good rates at their bank, but unless your situation is just like theirs, there is no real way to tell what your rates can be.
So What Can You Do?
Get financing from alternative financiers, like First Capital. Why? Because unlike banks and dealers, they work with all types of businesses and credit scores.
See, the problem with banks is that they want everything to be flawless. Your credit score must be immaculate, your business must be doing well, and you must have years of business experience.
If you’re just starting out and your credit score is hurting, a bank might not work with you. That’s why we suggest looking into alternative financiers. They will look at all aspects of your business to create a financing program that fits you, and your business.
While others lenders say no, an alternative fancier says yes.
Get the Equipment Financing Today You Need From First Capital Business Finance!
The only sure way to know what equipment financing rates you can expect is to speak with the financial experts at First Capital Business Finance. It just takes a few minutes to get pre-qualified over the phone! Ready to gear up your medic? Simply call us at 888-565-6692 or click below to finance your future.
Equipment Financing 101 | First Capital Business Finance