Business Finance Questions
How long will the equipment financing process take?
Requests up to $100,000 will be approved within 1-2 workdays after receiving a Business Financing Application along with supporting documents. Amounts over $100K will take 2-3 additional days depending on the complexity of the equipment leasing request. Upon approval, an equipment financing contract is sent immediately to the customer. Once the documents are signed, a Purchase Order is sent to the equipment vendor. The finance begins once the customer has signed an “acceptance” for the equipment received.
How can I speed up the business loan process?
Have all your financial documents in order, scanned into PDF files and easily accessible. Usually this includes 3 years of tax returns (personal & business), 3 months current bank statements, current balance sheet, income statement and personal financial statement. Some commercial lending or equipment financing programs require additional information. Each finance company has slight variations depending on the type of commercial lending they offer.
Do you offer business loans or commercial loans on used equipment as well?
Yes, we finance all types of used equipment. The used equipment has to be purchased from a commercial vendor and not a private party. Typically, used equipment can be financed up to 36 months. The used equipment can be structured as a business loan or equipment lease. Not all leasing companies will finance used equipment.
What happens at the end of the equipment lease term?
There are a variety of end of term options available depending on the type of business finance you have. These include Fair Market Value (FMV or Operating lease), $1.00 Buyout (Equipment Lease) and other Fixed Purchase Options (10% or 20% Buyout) or full payout business loan. You follow your end of finance instructions on your agreement. All business lending agreements have very specific details on how to buy out or return the equipment.
What is the equipment lease or business lending interest rate?
An equipment lease is not a principal and interest business loan, rates or money factors used to calculate payments are based on credit history, time in business, equipment cost, lease term and structure. As with commercial loans, the rate will directly depend on the risk, which is assessed for your particular business status. The bottom line: riskier business models or individuals pay higher rates. All business equipment financing, business loans and commercial lending are based on risk. Typically, leasing companies are more flexible in their credit parameters than banks, when looking to approve any commercial lending request.
Will my equipment lease payments be tax deductible?
The IRS will generally allow you to write off 100% of your equipment lease payment if the lease structure is within their guidelines. We recommend consulting with your tax advisor. When engaging in any commercial lending or project finance, speaking with a tax expert is always beneficial. Business loans and commercial loans of any kind will have long term consequences on your business.
Is the equipment leasing payments fixed for the term?
Your equipment leasing and business loan payments are fixed throughout the term. No mid-term balloon payments are part of a standard business financing program. You can select monthly, quarterly and semi-annual payments to fit your budget. Some project finance uses a custom payment schedule unique to their situation like solar financing.
What is the minimum dollar amount for equipment leasing?
$20,000 is our minimum amount for a business finance or commercial lending program. The minimum for “Green” projects including LED lighting and solar energy systems requiring extended 20 year terms is $5,000,000. The upper limit for equipment financing or commercial loans can include multi-million dollar projects. As a finance company in the technology market, we can handle a wide range of needs.
How long do you have to be in business for an equipment lease or business loan?
First US Finance LLC has asset-based equipment financing programs for start-up companies. Standard equipment leasing or commercial lending programs are available for companies that have been in business for a minimum of two years. However, most of our preferred programs require a minimum of five years in business. When looking at any business finance, time in business will always be critical unless you have strong collateral.
Is a deposit required for equipment financing or business lending?
Equipment leasing provides 100% financing. Although custom payment plans are available, First US Finance LLC typically requires two payments in advance with documentation fees when the equipment financing agreement is signed. All our equipment leasing and business loan programs have a similar fee structure. Working capital business loans have no advance payments.
Does it matter who works on my equipment financing?
We feel it does; some business finance agents work specifically for one lender, which limits their access to competitive capital and to get you approved. Some banks and leasing companies only use one funding source which limits your chances for success. First US Finance LLC contracts with a diverse group of national lenders and private investor groups, which means each equipment lease or business loan we structure is competitive in the business lending market. Some leasing companies only finance vehicles or working capital; we offer a complete business finance solution which covers a wide range of assets.