The Process of Equipment Financing
Updated: Jan 27, 2020
Equipment financing allows you to use the equipment you need for your business while simultaneously paying it off in a timely manner. The process is quick and easy. If your business is heavily lies on equipment such as construction, equipment financing can be very beneficial for your business. You may think equipment financing is as simple as a credit check. This may be true, but a lot goes on behind the scenes following that credit check.
When you first apply to finance a piece of equipment you: fill out an application, provide 3 months of your most recent bank statements, and a quote of what you’re looking to purchase.
But what happens afterwards? Your file then goes into underwriting. Underwriters are the wizards who work on your file (or as we call them; deals). From there they will review your credit. The best part about what Everlasting does? Not only do we just look at credit, but we use a story to go along with your deal. A story consists of what you do, how much experience you have, what your business does, and how this piece of equipment will benefit your business in the long run. This will increase your chances of getting approved. Our underwriters will put together a package and send it out to lenders who they see fit. The goal is not to only get you approved, but to also get you the best rate possible.
Approval, Contracts, & Funding
Once you get an approval, we will present you with your option(s). When a lender gives an approval, they provide a list of stipulations along with it if the customer chooses to move forward. Stipulations are documents that need to be fulfilled prior to funding. A checklist if you will. For equipment they usually involve things such as: your ID along with a voided business check, insurance, a final invoice, etc.
You may be wondering “why are all these things necessary?” Think of it like this. We’re basically allowing you to use the equipment while paying off simultaneously. Just like renting a car, we need your information to hold you accountable and to make sure the equipment will still hold its value. Once all the stipulations are met, you will be funded, and the equipment is yours!
There you have it. It may seem like a lot, but if everything goes smoothly, the process is quick and simple. This isn’t always the case, as you can always run into hurdles. What do you think can go wrong?