Equipment Financing from Clarify Capital

Equipment financing is a type of small business loan designed for the purchase of machinery or vehicles, whether new or used. It provides capital for items such as medical equipment, farm vehicles or computer equipment. The amount a business qualifies for depends on the purchase price of the machinery, and financing of up to 100% of the equipment's value is possible. The length of the term depends on the equipment type, its condition and how long it is expected to stay in service.

• Also known as an equipment loan
• Covers new and used equipment
• Borrow up to 100% of equipment value
• Interest rates as low as 6%
• Funded within 1 to 5 days
• Minimal paperwork and monthly payment terms

With equipment financing, the machinery being purchased serves as collateral for the loan, which means the lender can seize it if the borrower fails to repay. Because the loan is collateralised, qualifying is usually easier than for an uncollateralised loan, and the collateral can help lower interest rates and support approval for businesses with lower credit scores. Some lenders may also require a personal guarantee or use a blanket lien on business assets in the event of default. Interest charges on equipment financing may qualify as tax-deductible business expenses.

Clarify Capital lists four minimum criteria for equipment financing applicants. Credit is treated as one factor among several rather than the sole test, with a minimum score of 550. The company states that its lender network accepts lower credit profiles and simplifies paperwork compared with traditional banks.

• $10,000 average monthly revenue
• 550+ credit score
• In business for at least six months
• Have a business bank account

Advertised rates for equipment financing start at 6%, with repayment terms of 12 to 72 months and financing of up to 100% of equipment value. Clarify notes that quoted APRs across the market can range from roughly 4% to 45% depending on lender type and borrower profile, and that rates also fluctuate with market conditions such as the prime rate. Bank and SBA lenders often offer rates in the mid-single to low-double digits, while alternative lenders may charge more depending on risk and loan structure.

• Rates starting at 6% APR
• Quoted range of 4% to 45% APR
• Terms of 12 to 72 months
• Up to 100% of equipment value financed

Clarify Capital sets out a direct comparison between its own offer and that of a typical bank. Banks are described as offering competitive long-term rates but moving slowly and applying strict credit rules, typically requiring a score of 700 or above and often additional collateral or guarantees. Clarify states that approval is fast, with funds reaching the bank account within one to two days, against several weeks at a bank.

• Clarify approval: funds in one to two days; bank: several weeks
• Clarify minimum score: 550; bank: 700+
• Clarify collateral: the equipment itself usually secures the loan
• Best suited to businesses wanting fast funding and flexible underwriting

Equipment financing is used across a wide range of sectors, from construction and manufacturing to healthcare, retail and agriculture. Trucking and transportation businesses use it to purchase or lease trucks, trailers and tools, while manufacturers use it to buy, upgrade or repair machinery with no down payment required. Medical practices apply it to imaging equipment, dental chairs and technology upgrades. Retailers finance purchases ranging from computers upwards.

Heavy equipment financing is the strand of equipment lending aimed at businesses buying large pieces of machinery, and Clarify notes it is common in farming, landscaping and construction, where equipment carries a high price. APRs are advertised from 7%, with funding in one to five days and up to 100% of equipment value financed, compared with the 80% Clarify says most banks provide. Documentation is limited to the last three to four months of bank statements, and credit scores of 550 and above can be approved.

• APRs as low as 7%
• Funding in 1 to 5 days
• Up to 100% of equipment value
• Last 3 to 4 months of bank statements required
• Covers earthmoving, lifting, paving, forestry, heavy vehicles and farm machinery
• Option to buy or lease equipment

Applications are made online through Clarify Capital's website, with the form described as taking under two minutes and involving no hard credit pull. Applicants are matched with lenders from a network of more than 75, then review and compare APRs, terms and monthly payments before deciding whether to accept. Dedicated loan advisors are available to walk applicants through the process and help select a loan programme.

• Online application in under two minutes
• No hard credit pull to apply
• Matched with offers from 75+ lenders
• Offers compared on APR, term and monthly payment
• Equipment financing page: clarifycapital.com/equipment-financing

Equipment financing appears alongside other products in Clarify Capital's comparison tables, allowing borrowers to weigh it against alternatives for the same purchase. Term loans of up to $5 million over six months to ten years are positioned for fleet expansion and large bills, while business lines of credit up to $5 million are revolving and aimed at day-to-day cash flow. Invoice factoring, SBA loans and merchant cash advances are also listed. For vehicle purchases specifically, equipment financing is compared with commercial auto loans, leasing and SBA microloans.