Why You Should Get Equipment Financing

How to Choose the Right Equipment Financing Company

Is it Hard to Apply for Equipment Finance for Business?

Is Equipment Finance Worth it?

Conclusion

7 Signs You Could Use Equipment Finance

Equipment finance could be your best option if you need a new machine for work. If you're renovating a restaurant, a piece of new cooking equipment can be a good starting point for serving a special menu. And if you are considering venturing into aerial photography, a new camera drone would bring an element of versatility to your line of work. Whether you are in the IT or software industry, you can always benefit from equipment finance for business. Take a look at seven instances you could use this type of loan.

You can use equipment finance to fund a variety of equipment for your business.

You don't want to use traditional financing options

If you're feeling uneasy about the conventional bank loan process, maybe it's time to look at more modern, developing lending methods. A typical financial institution takes time to approve business loan applications. As a business owner, we know you don't have time to navigate tedious procedures, which is where Love Finance can help. We provide Automated Business Lender solutions. You don't need to concern yourself with drafting a balance sheet and lengthy documentation. Our business equipment financing requires fewer steps to save you money and time. You'll receive an instant decision, and the funds will reach your account in as little as 24 hours. We accept digital signatures, so the entire process is possible without in-person appointments.

You can't repair your existing equipment

Your business might be better off buying new equipment rather than fixing your existing models. Repairs can take up valuable time, and the equipment may break or falter again not long after. It may also be a question of cost. It is likely cheaper to finance new equipment rather than continuously forking out for costly repairs.

For example, compare the cost of repairing a printer versus buying a new one. If the repair cost exceeds 50% of the printer's value, it is pointless to fix the worn-out machine. Unless the printing machine is relatively new, you'd be better off if you get a replacement. This is especially true when the printer costs less than £200. Constant repairs will cost you more in the long run if you don't address the root cause of the problem.

Financing your equipment allows you to stay up-to-date and above your competitors.

Keep your business competitive

Sometimes, new products and services need an upgrade of business assets. Why not take equipment finance before your competitors take over? That way, you can meet consumer demands and stay relevant. Modernised equipment will help make you more competitive and stand out in the industry.

Protect your working capital

Don't wait until your bank account runs out to seek equipment finance for business. Your business doesn't need to be struggling. Many business owners who come to us can write a cheque and buy machines for cash. But they don't want to put their working capital at risk. At Love Finance, we understand how crucial your cash flow is. It makes sense to apply for a loan and preserve your checking account to comfortably pay your employees and utility bills and continue marketing your business effectively. Keeping these funds secure allows you to pay for any other unexpected costs your business might run into. 

You don't have additional collateral

Our financing options do not need traditional security. Love Finance only ever offers unsecured loans, meaning that you don't have to offer up your property or business assets as collateral. These types of loans are more favourable for the lessee as your assets are not at risk. Unsecured finance applications also have a lower processing time as there are no assets to assess. Additionally, we offer lower interest rates than regular bank loans.

If your business operates seasonally, you can customise your equipment repayment terms.

Your business operates seasonally

Our finance experts will help you choose a perfect loan term for your seasonal business, i.e., 1 – 5 years. If your sales are seasonal, we can customise your repayment terms, so you don't have to pay so much when your business goes quiet or slow. Depending on your industry, we may prolong the repayment period to fit your financial needs. Our monthly repayment plans are transparent, and you can choose between pre-determined and fixed interest. We also never charge early repayment fees if you want to repay the loan early. 

The economics of operating leases do not add up

Equipment leasing is only viable in the short run. It requires you to pay a periodic fee and return the equipment when the lease term ends. Your lessor will most likely charge you for damages that may have happened during the lease period. They also allow you to own the equipment by selling to you at a discount. That's why it's essential to calculate the cost of leasing before signing a deal. If it is more expensive in the long run, take an equipment loan instead.

How to Choose the Right Equipment Financing Company

Before choosing equipment finance for business, you first want to know the interest rate. Some companies attach extra charges to compensate for the interest. Be sure to ask if there are additional fees, especially when the interest rate seems too low to be true.

Also, consider the repayment period and figure out an instalment you can afford to pay per month. With Love Finance, you can opt for pre-agreed upon loan terms to repay the debt according to the performance of your small business.

Do your research when it comes to choosing an equipment finance lender.

Here are some other important factors you must not overlook:

Equipment specialisation

Finding a company like Love Finance that provides equipment loans for a broad spectrum of industries is advantageous. We serve clients in food and beverage, transportation, IT, production line, forestry, agricultural, building and construction industries. We understand that even construction project managers need office equipment to do their work effectively. We can finance your commercial vehicle along with office desks. This means you don't need to look for multiple lenders if you have a variety of machines to buy.

Industry experience

Be careful when dealing with new financing companies. They don't usually have enough resources and expertise that entrepreneurs need to finance their equipment. Select a company with a solid reputation. If they have decades of experience, they are probably more financially stable. Also, find out how they treat clients throughout the lending process. Do thorough research and, if possible, get word-of-mouth testimonies.

Equipment finance can be a great boost for your business.

Growth

The size of a financing company tells a lot about their reliability. A successful provider is constantly seeking to expand their offices and hire additional staff. They also partner with major banks and credit facilities to increase lending power and enhance credibility.

Customer service

Dedicated customer support is a good sign of a suitable lender. Look for a service whose customer representatives can consistently walk you through every step. Is their telephone line reachable? How fast do they reply to emails? How long do they take to give online quotes?

What You Need to Qualify for Equipment Finance

Your business should fulfil certain criteria to qualify for business equipment financing. Has it been around for more than three months, and is it based in the UK? If yes, you may be eligible for an unsecured loan of up to £500,000 to buy construction machinery. Your credit history will not impact your eligibility for equipment finance. In some instances, you might need a personal guarantee whereby your assets will be at risk if you default on the loan. Remember that leasing is available if you don't qualify for equipment finance. But this requires a personal guarantee, security or down payment.

Your business needs to meet certain criteria to qualify for equipment financing.

Is it Hard to Apply for Business Equipment Finance?

We believe that clients should access finance in the shortest time possible. We employ fast and straightforward technology to speed up the loan application process. Here at Love Finance, we automate the entire process from the time of consultations to loan reimbursement and maturity. After finding the option that suits your needs, all you need to do is fill out an online form.

This process only takes a few minutes. Next, we will give you our verdict based on your documentation. We then send you a loan form that you can sign from any smart device. Finally, we should be able to credit your bank account with the loan amount within 24 hours.

To make the process even quicker, make sure your financial documents are ready for inspection before sending them to us. It helps to write down a business plan, explaining how you will be using the equipment and how you will manage to repay the loan.

Is Equipment Finance Worth it?

Before you decide to take an equipment loan, there are a few questions you should ask yourself.

1. What will the return on investment of the new machinery be?

2. Will a new business asset improve revenue?

3. Will it reduce overhead costs and save time?

4. How about the tax burden? Will it increase or reduce?

After analysing the economic benefits of a new piece of equipment, compare them with the cost of taking a loan and whether it is worth it in the long term.

Finance your equipment adds revenue to your business without emptying your bank account.

Conclusion

Conventional financing options are suitable for small businesses, but they take too long to process. If you need to replace a machine, the idea of taking a regular bank loan can be so inconvenient. Some situations cannot wait when you have to deal with customers. At the same time, you cannot afford to lose business. In this case, a quick solution that will position your venture for steady growth is beneficial.

When seeking equipment finance for business, scrutinise the lender as well as your financial needs. Whether in the horticultural sector or the construction industry, new machinery is not something to take lightly. It is a big commitment, considering it comes with an attached interest rate. Choose a company that goes beyond offering competitive rates. Ensure it has a verified track record and specialises in diverse fields.

Visit our website today to find out what our business equipment finance experts can do for you.