Best Equipment Financing Companies For Small Business

Total Rating	4.8
Rates & Fees5.0 Pricing 5.0 Affordability 5.0
Services5.0
Eligibility Requirements4.9
Application4.5
Sales & Advertising Transparency4.4 Sales Practices 4.0 Web Presence 5.0
Customer Service4.9
User Reviews4.9

Pros

High borrowing amounts
Applicants can be quickly prequalified
Application process is fast and easy
Borrowing qualifications are lower than banks

Cons

Funds can take awhile to disburse
Rates can be expensive

Why We Chose Lendio For Equipment Finance Loans

The name of the game with Lendio is “efficiency.” With a single application, you can apply to Lendio’s entire network of lenders, thereby greatly increasing the chance that you’ll not only be approved but receive multiple offers. Lendio also offers higher borrowing limits than many of its competitors, making it a great choice for businesses that need to finance heavy equipment. Better yet, Lendio’s equipment loans don’t require a down payment.

Lendio Services

Lendio offers a wide variety of funding:

Equipment financing up to $5 million
Short-term loans up to $500,000
Term loans up to $2 million
Lines of credit up to $500,000
Merchant cash advances up to $200,000
SBA loans up to $5 million

Lendio Rates & Fees

APRs for Lendio’s equipment financing start at 7.5%.

Lendio Eligibility Requirements

Each of Lendio’s partners has its own lending criteria, but you’ll want a credit score of at least 550 to qualify for something. The higher your credit score, the more likely you are to get offers.

Get Started With Lendio

SmartBiz: Best For SBA Loans

SmartBiz

Get Started With SmartBiz

Total Rating	4.7
Rates & Fees4.8 Pricing 5.0 Affordability 4.5
Services4.8
Eligibility Requirements4.8
Application4.5
Sales & Advertising Transparency4.9 Sales Practices 5.0 Web Presence 4.7
Customer Service4.9
User Reviews3.5

Pros

High borrowing amounts
Rates tend to be inexpensive
Long-term financing options available

Cons

Borrower qualifications may be hard to meet
Funds can take a long time to disburse

Why We Chose SmartBiz For Equipment Finance Loans

When it comes to lenient term lengths and low interest rates, it’s hard for small businesses to do better than SBA loans. This includes SBA 7(a) and 504 loans, both of which can be used for equipment financing. However, getting an SBA loan can be a laborious task, particularly if you’re unfamiliar with the process. SmartBiz works with a network of SBA-approved lenders to help ease small businesses through the process.

SmartBiz Services

SmartBiz offers the following services:

SBA loans up to $5 million
Term loans up to $500,000

SmartBiz Rates & Fees

APRs for SmartBiz’s SBA loans run between 5.04% to 10.29%.

SmartBiz Eligibility Requirements

SmartBiz’s eligibility requirements are as follows:

2 years in business
Sufficient cash flow to support repayments
650 for SBA loans / 660 for bank term loans

US Business Funding: Best For Refinancing Equipment

US Business Funding

Get Started With US Business Funding

Total Rating	3.6
Rates & Fees3.0 Pricing 3.7 Affordability 2.2
Services4.3
Eligibility Requirements4.1
Application4.5
Sales & Advertising Transparency2.8 Sales Practices 3.0 Web Presence 2.5
Customer Service2.0
User Reviews3.8

Pros

Borrower qualifications are lower than banks
High borrowing amounts
Application process is fast and easy
Funds are disbursed quickly

Cons

Rates can be expensive

Why We Chose US Business Funding For Equipment Finance Loans

US Business Funding offers a few advantages to small businesses seeking equipment financing. The first is that it has programs for businesses that are as new as six months old; lenders typically reserve equipment financing for more mature businesses. Another is that it offers a variety leasing buyout options, making it a strong choice for businesses looking to finance rapidly depreciating assets. Finally, US Business Funding offers refinancing options for equipment.

US Business Funding Services

US Business Funding offers the following services:

Equipment loans and lease up to $10 million
SBA loans up to $5 million
Term loans up to $10 million

US Business Funding Rates & Fees

APRs for US Business Funding equipment financing starts at 3.5%.

US Business Funding Eligibility Requirements

US Business Funding’s eligibility requirements for equipment financing are as follows:

6 months in business (2 years preferred)

Get Started With AgDirect Equipment Financing

AgDirect: Best For Agricultural Equipment

AgDirect Equipment Financing	Visit Site

Pros

Interest rates tend to be low
Funds are disbursed quickly
Qualifications are lower than banks

Cons

Only serves agribusiness
Opaque borrower qualifications

Why We Chose AgDirect For Equipment Finance Loans

AgDirect is a highly specialized equipment financing company that is, essentially, a convenient way to access and leverage the Farm Credit System to purchase, lease, or refinance farm equipment. Rates tend to be better than what you’ll typically see with other lenders, so if you’re in the industry, AgDirect should be near the top of your list of options.

AgDirect Services

AgDirect offers the following services:

Equipment loans and leases from $5,000 up
Equipment auctions

AgDirect Rates & Fees

AgDirect rates and fees vary by term length and the amount financed. Fixed rates range between 6.75% and 7.55%. Variable rates range from 7.25% to 8.25%.

A documentation fee, which includes origination fees and all other service fees and is capped at $300, is also charged.

AgDirect Eligibility Requirements

AgDirect doesn’t provide a lot of information about qualifications, but there is no minimum credit score to qualify.

Get Started With Crest Capital

Crest Capital: Best For Leasing Options

Crest Capital	Visit Site

Pros

Fast and easy application process
Multiple types of financing available
Excellent customer service

Cons

Not available to all industries
Rates can be expensive

Why We Chose Crest Capital For Equipment Finance Loans

Crest Capital is one of the older equipment financing companies that is explicitly small business-focused. While many other non-bank funders only dabble in equipment financing, Crest Capital offers a comprehensive list of leasing options and buyout agreements. Rates, while not the cheapest in the business, tend to be competitive.

Crest Capital Services

Crest Capital offers equipment leases up to $500,000.

Crest Capital Rates & Fees

Crest Capital’s APRs start at 5%. Leases require a first month down payment. There’s also a one-time administration fee of $275.

Crest Capital Eligibility Requirements

Crest Capital has the following borrower requirements:

2 years in business
650 credit score

National Funding: Best For New Businesses

National Funding

Get Started With National Funding

Total Rating	3.7
Rates & Fees3.8 Pricing 3.7 Affordability 3.8
Services2.8
Eligibility Requirements4.3
Application4.8
Sales & Advertising Transparency3.8 Sales Practices 4.0 Web Presence 3.5
Customer Service2.9
User Reviews3.7

Pros

Borrower qualifications are lower than banks
Discounts for early repayment
Fast and easy application process
Funds are disbursed quickly

Cons

Rates can be expensive

Why We Chose National Business Funding For Equipment Finance Loans

One of the big Catch-22s for newer businesses, particularly those that need to buy big-ticket items to function, is that most lenders want to see that you’ve been in business for a while. With equipment financing, that can typically be as long as two years! National Business Funding, however, will work with businesses as young as 6 months old, provided they have decent credit and revenue.

National Funding Services

National Funding offers the following services:

Equipment loans and leases up to $150,000
Short-term loans up to $500,000

National Funding Rates & Fees

National Funding’s equipment financing APRs start at 5%. There is also a 3% origination fee.

National Funding Eligibility Requirements

National Funding has the following borrower requirements:

6 months in business
600 credit score
Annual revenue of $250,000

Loan Marketplace Review Methodology

We spend hours researching and evaluating each business loan marketplace we review at Merchant Maverick, placing special emphasis on key characteristics to generate our ratings.

When rating lending marketplaces, we use a 39-point rubric that looks at rates and fees, services, eligibility requirements, application, sales and advertising transparency, customer service, and user reviews. We weigh each section differently to calculate the total star rating.

Rates & Fees: 15% of the total star rating
Services: 30% of the total star rating
Eligibility Requirements: 15% of the total star rating
Application: 15% of the total star rating
Sales & Advertising Transparency: 10% of the total star rating
Customer Support: 10% of the total star rating
User Reviews: 5% of the total star rating

Each section is further broken down into granular, weighted subsections, in which we examine specific attributes like the variety of lending products and partners available, terms lengths, conditions of repayment, credit score and revenue requirements, ease of application, length of time to funding, the ethics involved in promoting the loan marketplace.

Read more about how we rate loan marketplaces.

Understanding Equipment Financing

Types Of Equipment Financing

Type Of Funding	What It Is
Equipment loan	A secured term loan exclusively used to purchase hard assets that uses the asset being purchased as collateral.
Capital lease/equipment finance agreement/$1 buyout lease	A lease that transfers ownership of the leased equipment to the lessee. The equipment is almost always retained by the lessee at the end of the lease, making it an alternative to a loan.
Operating lease/FMV lease/true lease	A lease that serves as a rental agreement. At the end of the lease, the lessee has the option to purchase the equipment for an agreed-upon amount or return it to the lessor. Comes in a variety of buyout terms.

How To Choose The Best Equipment Finance Loan Or Lease

Equipment financing is low key one of the more complicated types of business financing. Not only do you want to keep in mind factors that apply to all business loans like interest rates, your ability to qualify, and term lengths, but you need to consider how the equipment you’re purchasing retains (or doesn’t retain) its value and utility over time. Additionally, how the equipment appears in your accounting records can have tax implications, so you’ll want to consider whether or not you want permanently own the equipment you’re buying or, effectively, rent it with an operating lease.

Talk to your peers in your industry to get a sense of how they handle equipment acquisition and turnover to make sure getting the best return possible on your investment. And remember, many of the best business loans can be used for equipment purchases even if they aren’t explicitly for buying equipment.

FAQs: Equipment Financing

What are the typical terms for equipment financing?

Equipment financing terms usually last around 5 years, with some variation depending on the lifespan of the equipment. Equipment financing typically has monthly repayments with fixed interest rates.

Is it better to lease or finance equipment?

Loans tend to have better interest rates than leases, but leases are more likely to cover soft costs. Leases may also be a superior option when it comes to financing equipment that quickly depreciates or becomes obsolete within a few years.

What credit score is needed for an equipment loan?

Equipment loan requirements tend to be conservative. While it’s possible to get an equipment loan with a credit score of 600 or less, you generally want a credit score of at least 650.

What is a good interest rate on an equipment lease?

Ideally, a good interest rate on an equipment lease is below 10%, taking into account your credit history and borrower profile.

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Chris Motola

Senior Staff Writer at Merchant Maverick

Chris has been writing about small business topics since 2003. In 2015, he joined Merchant Maverick, where he writes about business financing, payment processing, and demographic trends in entrepreneurship. Chris has been featured in Fox Business, ABC News, Yahoo Finance, GoBankingRates, Newsweek, BizJournals, and other publications. He has a Bachelor’s of Arts in English Writing Arts from SUNY Oswego, and a Masters of Science in Interactive Media from the University of Central Florida. He currently resides in the Hudson Valley region of New York.

View Chris Motola's professional experience on LinkedIn.

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1. Lendio

❮ ❯

Equipment loans
FICO: 550+ (recommended)
APR: 7.5%+

2. SmartBiz

❮ ❯

Equipment loans
FICO: 650+
APR: 5.04%+

3. US Business Funding

❮ ❯

Equipment loans & leases
FICO: No minimum given
APR: 3.5%+

4. AgDirect Equipment Financing

❮ ❯

Equipment loans & leases
FICO: No minimum given
APR: 6.7%+

5. Crest Capital

❮ ❯

Equipment leases
FICO: 650+
APR: 5%+

6. National Funding

❮ ❯

Equipment loans & leases
FICO: 600+
APR: 5%+