U.S. Bank Equipment Finance Review

Pros

• Suited for large businesses
• High borrowing amounts
• Applicants can be pre-qualified
• Good public reputation

Cons

• Opaque terms and fees
• Financing isn’t available in some states

Services Offered

U.S. Bank Equipment Finance offers loans and leases for the specific purpose of acquiring physical equipment related to the operation of the business.

U.S. Bank finances the following types of equipment:

• Medical
• Dental
• Veterinary
• Manufacturing
• Construction
• Commercial
• Office furniture & fixtures
• Phone systems
• Computer hardware & software

Borrower Qualifications

Here are the borrower qualifications for U.S. Bank’s Equipment Financing:

In addition, you’ll need to:

• Have an estimated price and description of the equipment you’re looking to finance
• Own at least 51% of your company

Terms & Fees

Here is an overview of U.S. Bank’s equipment finance products.

U.S. Bank uses a kind of triage system for its equipment financing products. Businesses looking for a faster process can select a quick, application-only process that’s capped at $150,000. You can also seek pre-approval for up to $500,000 in financing.

Unlike many traditional lenders, U.S. Bank doesn’t require a down payment for equipment financing. In fact, the bank extends financing up to 125% of your equipment costs to cover the costs of installation, tax, and shipping.

In broad terms, tax leases are arrangements where the equipment you’re leasing never appears on your balance sheet. Instead, the bank retains the title, as well as all the responsibilities and benefits of ownership. You, the lessee, are treated like a renter for tax purposes. Tax leases are usually operating leases, though not all operating leases will qualify as tax leases starting in 2019.

Non-tax leases, on the other hand, appear on your balance sheet either because the lessor transfers the title to you, or because they’re operating leases with term lengths longer than a year. Finance/capital leases are non-tax leases.

Tax issues aside, the main things to keep in mind with leases are:

• Do you want to own or return the equipment at the end of the lease?
• How much do you want to pay each month vs. the leftover amount (residual) that you have to pay at the end of the lease?

If you are financing a piece of equipment that becomes obsolete quickly (like technology), it might not be worth owning. In this case, you’ll want an operating lease, which usually means lower monthly payments and the option to return it at the end of the lease. Meanwhile, capital leases are designed to facilitate ownership, meaning the total cost of the equipment will be factored into your lease payments and residual.

Application Process

If you’re a small business looking for $150,000 or less, U.S. Bank offers a simplified version of its application. Additionally, U.S. Bank now allows borrowers to apply online for equipment financing of up to $249,999. Also, since you are dealing with a traditional bank, you can physically go to your local branch.

Prior to applying, you’ll need to make sure you have information about all the owners with a 25% or more stake in ownership, including their SSNs and birth dates. You’ll also want to have a description of the equipment you intend to buy and its cost.

Sales & Advertising Transparency

U.S. Bank recently updated its somewhat-dated site. While it looks more modern and better organized, it’s come at the cost of some product information. The site currently presents the basics–borrowing amounts, product names, etc.–but not much more.

Customer Service & Technical Support

U.S. Bank’s staff is polite and helpful, but it can be challenging to find a representative who both has the answers and is cleared to give them to you. Many user reviewers on the BBB website claimed to find it difficult to get U.S. Bank to respond to their problems in a timely manner.

User Reviews

At the time of this update, the Better Business Bureau’s profile of U.S. Bank was unavailable. The bank had an A- ranking at the time of our previous update.

Overall, the bank has the customer problems you’d expect: lots of disputes over fines and payments.

Negative Reviews & Complaints

Issues customers have with U.S. Bank include:

• Large And Impersonal: Many customers complained about the bank being unresponsive to their complaints.
• Billing Issues: Like most major banks, a large percentage of U.S. Bank’s customers are complaining about overdraft fees.
• Harder To Qualify: Compared to alternative lenders, companies seeking equipment financing from U.S. Bank will have a higher bar to clear in terms of credit rating.

Positive Reviews & Testimonials

Advantages of financing with U.S. Bank include:

• Deep Pockets: Larger corporations and businesses that need seven-figure financing will be able to find it here.
• Well-established: U.S. Bank is one of the larger and more stable financial institutions in the country.
• Branches Are Accessible:  Even in the digital age, sometimes it’s just easier to take care of business in person. Customers in the 25 states served by U.S. Bank branches should have an easy time finding a branch.

Final Verdict

Larger businesses, particularly those based in the Midwest, will likely find U.S. Bank’s resources and industry-specific approach to equipment financing beneficial. The express application for small businesses seeking smaller amounts of funding is also a perk.

Like many larger corporations, however, U.S. Bank doesn’t easily part with specific information and details. This might not be a problem for large businesses, but smaller companies would benefit from the ability to more easily do comparison shopping. While not specific to equipment financing, bear in mind that many user reviews expressed frustration with U.S. Bank’s approach to customer complaints.

If you’re looking for alternatives, check out our other equipment financing reviews.

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