Equipment Financing Guides

Loans and leases against the equipment itself: trucks, machines, medical devices, kitchens and fixtures, new or used.

Equipment financing pays for a specific machine, vehicle or system and uses that equipment as the collateral, which is why it is among the most available forms of business capital, including for young companies and industries that banks avoid. Equipment lenders underwrite the asset as well as the borrower: its type, age, resale market and useful life all shape the amount, the term and the down payment, which commonly falls between ten and twenty percent.

The structure matters as much as the approval. A loan builds ownership from the first payment, while a lease can lower payments and keep equipment current, and Section 179 can change the after-tax cost of either, subject to limits and the owner's circumstances. These guides cover loans against leases, new against used, vendor programs, sale-leasebacks and the industry-specific equipment questions lenders ask.

Guides

Frequently asked questions

How much down payment does equipment financing require?

Many equipment lenders commonly ask for roughly ten to twenty percent down, and some strong borrowers finance the full cost. Used, specialized or hard-to-resell equipment, a young business or weaker credit usually means a larger down payment. The exact amount depends on the lender and the asset.

Is it better to lease or finance equipment?

Financing builds ownership and suits equipment with a long useful life. A lease can lower the payment, simplify upgrades for equipment that ages quickly, and sometimes keeps the asset off the balance sheet. The tax treatment differs between the two, so the decision is worth reviewing with a tax adviser.

Can I finance used equipment?

Yes. Many lenders finance used equipment, often with shorter terms or a larger down payment, because the collateral has less remaining life and a narrower resale market. An inspection, an appraisal or a dealer invoice with the serial number helps the lender value it.

How MercFinancial places it

Business Funding — Eight programs, one file, 160+ lenders.