From being in the startup phase to pushing through a growth stage or rising like a phoenix from the ashes of a downturn, there are times when you need to finance essential business equipment. Doing so isn’t cut and dry for many business owners, but rather presents a series of hurdles to overcome in order to obtain the equipment financing they need to start, grow or rebuild the company.
Here are some of the most common hurdles our team of Certified Lease and Finance Professionals (CLFP) see in the industry, and better yet, how you can overcome them.
You’re Trying to Finance Equipment for a Startup
Your startup needs financing to obtain the equipment required to get it off the ground. However, big banks want to see a long track record of growth before financing your equipment lease. Startups don’t have a track record yet.
Look to alternative equipment financing providers, like Global Financing & Leasing Services, LLC (GFLS), who work specifically with startups that don’t qualify for traditional financing. We’re a private company founded in 2009 to serve small- to mid-sized businesses and startups that aren’t attractive to traditional lenders for whatever reason. We look at more than what’s on or not on the application. We look at YOU and match equipment financing options to match your goals and budget.
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You’re Considering Using Personal Credit to Finance Business Equipment
There are very few times when this makes sense, and business advisors caution against mixing your personal credit with your business. Traditional lenders will often require a personal guarantee on an equipment loan if the business doesn’t have a credit history or any collateral to secure the loan. The problem arises if your business cannot make the payments on the loan. Creditors can seize your personal assets, causing you to lose both business and personal possessions. This can lead to declaring business and personal bankruptcies.
Protect your personal assets by keeping equipment financing in the business’s name. Again, work with a lender who doesn’t require personal guarantees, even if your business doesn’t meet traditional lenders’ typical requirements. They are out there because we are one them. While we look at your personal credit history, we take your entire story into consideration.
You Don’t Have a Spotless Credit History
If your credit history isn’t as impressive as you’d like it to be, take deliberate action to improve it. Of course, this doesn’t help you finance equipment in the short term, but it will benefit your business down the road.
For now, show positive aspects of your financial performance history, such as long periods of positive cash flow, how much your business sells each month, how quickly you were able to turn a profit, how well you have managed expenses, and testimonials from long-time, loyal customers, etc.
A direct lender, like Global Financial & Leasing Services, LLC, is willing to see you as more than numbers and considers character and integrity. If you have imperfect credit, we still strive to work with you on getting the essential business equipment you need to succeed. If your time in business or credit history is putting your business’s future on hold, work on improving your personal credit and talk to GFLS about your equipment leasing needs.