Guide

What counts as equipment for financing?

Anything with a serial number, a useful life of several years and a resale market: vehicles, machinery, kitchen and medical equipment, lifts, printers, IT hardware. The test a funder applies is whether the asset can be identified, valued and recovered — which is why software, leasehold improvements and consumables usually cannot be financed this way.

What funds easily

Titled vehicles — trucks, trailers, vans, plant. Best of all, because title, mileage and market value are all verifiable in minutes.

Serial-numbered machinery: excavators, CNC and press equipment, commercial kitchen lines, dental chairs, imaging equipment, gym racks, salon and laser equipment.

Anything with an established used market. A funder is pricing the possibility of recovering and selling the asset, so the depth of that market moves the terms.

What does not

Leasehold improvements. A fit-out is attached to premises you do not own and cannot be repossessed, so it is a working-capital or term-loan question.

Software and licences, generally. There is no resale market and often no transferable licence, though hardware bundled with it can sometimes be included.

Consumables and stock. They are consumed rather than owned over years, which is a working-capital use.

Assets already pledged elsewhere. If another lender holds a lien on it, it is not available as security.

Why it matters which bucket you are in

Equipment financing is the cheapest money most small businesses can get, because the asset genuinely secures the debt and the term matches its life.

Buying a machine out of a nine-month advance is the most expensive way to acquire it — you pay unsecured pricing for something that could have secured its own loan over five years.

Where a purchase is part equipment and part fit-out, split it. Finance the equipment as equipment and fund the rest separately, rather than putting the whole thing on the more expensive product.

Sources

Related questions.

Can I finance equipment I already bought?
Sometimes, through a sale-leaseback, if the purchase was recent and the asset is unencumbered. Terms are less good than financing it at the point of purchase.
Does it have to be from a dealer?
No. Private-party and auction purchases are financeable, though a funder will want an invoice, a serial number and often an independent valuation.
Can I finance a vehicle for personal and business use?
Business use has to be the primary purpose. Mixed use is common and accepted; a car that is mainly personal is not a business equipment deal.

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