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Equipment Lease Tips for the Credit Challenged

Posted on | August 16, 2010 | No Comments

If you are a business owner trying to find practicable methods of financing, perhaps you may consider a business equipment leases. Compared to business loans, the process of applying for an equipment lease will prove to be far less complicated and quicker.

Generally, leasing companies require the submission of the following paperwork: financial statements, tax returns, business plan and lease proposal. Credit history will also be a factor in acquiring business lease financing. However, if you have bad credit history, does that mean you should eliminate leasing from your business financing options? The answer is no.

Leasing Programs For The Credit Challenged

If you have bad credit history, you’ll be glad to know that there are business equipment leasing companies that offer lease programs that are especially designed for the credit challenged. In fact, you can use your lease to rebuild your damaged credit history and work out a fresh start through timely lease payments.

Before applying for a lease, check your credit report and make sure that all your credit problems are already in the past. See to it that all your debts have been paid and that you presently are in good standing with your creditors. If you have a record of bankruptcy, most leasing companies will reject your application if the bankruptcy is recent or has only been discharged for less than 2 years.

Be prepared to submit a written explanation as to the negative remarks in your credit report. In the same letter, it would be wise to point out the steps you have done to improve your credit history and to avoid credit problems again. OF course, you will need to prove that you are capable of paying your lease through your financial information.
A Word of Advice Before Applying for A Lease

Before submitting your application to a leasing company, it’s very important to make sure that this lessor accepts applicants who are credit challenged. Take note that most leasing companies strictly require good credit history. Thus, if you submit your lease application to the wrong lessor, your application may get rejected.

Keep in mind that each time a potential creditor inquires your report; your credit risk score can be lowered. In addition, a potential lessor may simply refuse financing your business, if it finds too many inquiries from other leasing companies in your credit file. If you get declined too many times, then surely any leasing company will have doubts about your credibility.

About the Author

Lai Castillo is an equipment leasing broker that specializes in getting start up business equipment lease.

Category: equipment lease, equipment leases
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