What is Power Equipment Financing?
Power equipment financing is financing designed to help you buy power equipment at accessible rates, all while building equity in the equipment you will eventually own. Whether you operate a landscaping company, a construction firm or a bike shop, working power equipment is an essential to keeping your business operating in a smooth, effective and above all safe manner. Power equipment isn’t cheap, and it can be tough to foot the bill for a new machine even when your business is profitable. With power equipment financing from both vendors and financing companies, you can take advantage of financing plans to acquire the equipment you need.
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Many power equipment vendors offer no interest financing deals for the first period of a loan. Scag Power Equipment, for example, offers 48 months no interest financing. Usually, with these no interest deals, you will be expected to purchase a minimum amount of product ($1,500 in the case of Scag), and you may also be required to pay a financing fee upfront.
It’s important to beware of a high-interest rate, usually between 20.99% and 29.99% APR once the promotional no interest period runs out. If you chose to pass on the no interest financing plans, your interest rate will be calculated based on your credit score and will be reasonably lower than those of the no interest rate promotion deals. If your credit rating is strong, you may be able to secure an interest rate as low as 1.59%, thought rates can be as high as 26.99% if your rating is lower.
To secure a decent interest rate, power equipment vendors and financiers are typically looking for a credit score of at least 660. This doesn’t mean you can’t secure financing with a score lower than that, but you will have a much harder time finding decent terms. You may also be required to submit your business’s financial history or your personal financial history if your business doesn’t have a financial history to look at. Most vendors and financiers require that you purchase a minimum amount of equipment to qualify for financing. A minimum of $500 dollars is pretty standard, but it’s possible to find lower minimums.