Locating the right equipment for your contracting or construction business whether it be a pickup truck, table saw, excavator, concrete mixer, dump truck, or something else, is an important decision that can impact your business’s productivity and revenue. However, securing the best financing for your equipment is also very important. This article provides a helpful guide of how to locate the best equipment financing for your contracting business.
1. Consider Your Business’s Needs
Before diving into the best equipment financing options, conduct a careful analysis of your contracting company’s financial position and develop a reasonable budget for your equipment. Equipment for contractors can be expensive, and failure to repay your equipment financing could be very detrimental to your business. Consider the type of equipment required for your contracting operation, a local contractor will have different construction equipment needs than a large-scale construction outfit. Understanding your specific needs will guide you in selecting the best equipment financing options.
2. Explore Traditional Lenders
Traditional equipment lenders, such as South End Capital (which is one of the top equipment lenders in the country), are viable options for construction equipment financing and can offer fast, application-only options. Research their interest rates, terms, eligibility criteria, and read lender reviews. While traditional lenders may have more conservative requirements, they often offer competitive rates for contracting companies with strong operating histories especially when they are purchasing what’s known as yellow-iron and other popular construction equipment.
3. Explore Alternative Lenders
Online lenders like Headway Capital and its flexible and popular True Line of Credit™ have emerged as a best alternative financing option for construction equipment, providing a streamlined application process and quick approval timelines. Explore online lenders specializing in equipment financing for contractors and compare their rates and terms. Online financing can be particularly advantageous for contracting companies seeking efficiency and accessibility. Certain online lenders even offer equipment financing with no financials.
4. Consider Dealer Financing
Many dealers offer in-house financing options for construction equipment. While convenient, it’s essential to scrutinize interest rates and terms to ensure they align with your financial goals and are competitive with specialty lenders. Negotiate with dealers to secure favorable financing terms while also exploring potential discounts on equipment prices for your contracting business.
5. Evaluate Lease Options
Leasing is a popular alternative to purchasing construction equipment outright. It usually offers lower monthly payments than standard equipment financing, and the flexibility to upgrade to newer equipment regularly. Evaluate lease options from both conventional lenders and specialized lease financing companies to determine which aligns best with your contracting business’s needs and financial wherewithal.
6. Understand Equipment Financing Terms
Carefully review the repayment terms, costs, and conditions associated with each contractor equipment financing option. Consider factors such as interest rates, financing durations, down payment requirements, and any potential penalties for early repayment. Choose a financing option that aligns with your contracting company’s cash flow and financial goals.
Conclusion
By following the above suggestions, you’ll have the tools to explore the landscape of contractor equipment financing and Borrow Confidently™. Whether you apply for equipment financing with traditional lenders, specialty online equipment lenders, or explore alternative financing options, a thoughtful approach ensures you secure the best equipment financing for your contracting business’s growth needs.
Interested in accessing the best contractor equipment financing? Contact our recommended best contractor equipment lenders South End Capital and Headway Capital.