What is an Equipment Sale Leaseback?
Its when you use your businesses existing equipment or real estate, that is already paid for, as collateral for a loan.
What are the requirements for an equipment sale-leaseback ( a.k.a secured business loan)
The main requirements for this type of business loan are:
- You must own the equipment. 100% paid for. Or it must be almost paid for, and part of the loan proceeds will pay off the balance.
- Equipment should be in good working condition – we always send out an inspection team to make sure the equipment is in good condition
- Equipment should have value. What I mean is that things like computers can’t be used because they lose their value too quickly. We prefer titled equipment, but we have done none titled equipment as long as the business owner could provide a bill of sale (proof of when and how much they paid for the equipment)
Businesses choose this type of secured business financing because it provides:
- Fast approval and funding. Applications can be approved within 24 hours once everything is in order.
- The loan amount can be used to purchase more equipment. Or you can use it for working capital.
- Not dependent on business owners credit. Since the loan is 100% secured. We have been able to approve business owners with a credit score below 550! WITHOUT a co-signer!
- Startups can be approved. Time in business doesn’t matter.
- Funding can take place in 3 to 5 days. It depends mainly on how quickly we can arrange an inspection company to go to your location.
Ready to apply? Visit our Equipment Sale Leaseback page to know more about how this financing option works.
**Article updated 8/4/18 by L. Roberts
Liz Roberts has been in the business financing industry for 20+ years. She got her start in banking, went on to consumer and commercial collections and then onward to becoming a senior credit analyst for several small leasing companies. She has also been a freelance writer for 15 years and has written about business and consumer financing on several blogs. She also maintains a low carb living blog.