Equipment Financing
The equipment is the collateral, so approval is easier and terms are longer. Trucks, machinery, medical devices, kitchen lines, IT.
Updated September 2026. Details vary by lender and change often; confirm terms with the provider.
How it works
The lender pays the vendor directly and takes a lien on the equipment. Because they can repossess and resell it, they accept weaker credit and newer businesses than unsecured lenders would.
| Typical range | |
|---|---|
| Amount | 80–100% of equipment cost, $5k – $2M+ |
| APR | 7% – 30% |
| Term | 2 – 7 years (matched to useful life) |
| Down payment | 0 – 20% |
| Minimums | 6+ months in business, 600+ credit (lower with a down payment) |
Why it often beats a general loan
- Longer terms, so lower monthly payments.
- Approval rests on the asset, not only on your financials.
- Section 179 lets many businesses deduct the full purchase price in the year of purchase (talk to your accountant).
Watch for
- Blanket liens: the lender should take a lien on the equipment only, not all business assets.
- Documentation fees and end-of-lease “fair market value” buyouts that were never quoted.
- Financing soft costs (installation, training) at the same rate. Reasonable, but confirm it is included.
Frequently asked questions
Loan or lease?
A loan means you own the equipment at the end. A lease has lower payments and may let you upgrade, but you pay more over time or owe a buyout. For equipment that lasts (trucks, ovens, CNC) buy; for things that go obsolete fast (IT, some medical tech) leasing can make sense.
Can I finance used equipment?
Yes, most lenders finance used equipment from dealers and many from private sellers, usually with a slightly higher rate and shorter term.