What Do You Need To Qualify For Equipment Finance?
Equipment finance is a unique loan type that’s ideal for businesses that need financial investment. In some cases it can be applied for on an individual (or personal) basis, but as the majority of lending agencies tailor their services to suit those within professional sectors, it’s no wonder why thousands of companies turn to these ideal solutions every year.
For those that wish to apply for funding from a lender, there are certain criteria that will need to be met. This criteria can vary from lender to lender, but in the majority of cases all terms and conditions will be fairly similar – although it is worth noting that particular specifications and details pertaining to an applicant’s eligibility may overrule any of the details listed below.
A consistent operation of business
For start-ups it won’t always be an option to apply for financing, as the majority of lenders will request that their applicants have at least 11 months of consistent earning. This doesn’t apply to personal earnings, but those specifically derived from a professional enterprise. In some cases an applicant’s credit history can be used to knock a few months off of the total, unless the credit score is that impressive that a lender is willing to overlook their policies and extend finance without any professional activities whatsoever.
A healthy credit score
All credit scores, regardless of their applicant’s nationality, will add up to a total of 800. As far as potential lenders are concerned, anything over 600 can be a viable amount. Those that come close to 600 (for example between 550 and 600) may find other options made available to them – or they may be required to pay a little upfront to act as a deposit. For those with scores of over 700, they shouldn’t have any difficulty obtaining a loan – and the closer to 800, the better their deals might be.
Annual income of a particular sum
This is where things can get a little tricky, as most lenders will require that their borrowers can demonstrate that they make at least a certain amount every year. In the majority of cases this will be roughly $120,000 AUD – but again (and we can’t stress this enough), the amount will be situational. Some people may want to borrow as little as $10,000 AUD and so they won’t typically need to demonstrate a higher level of earnings. The thing to remember is that the more you’d like to borrow, the more you will be expected to earn in order to assure your lender that you will be able to meet your repayments.
If in doubt, always get in touch with a reliable finance broker – one that could actually end up helping you to sign up to a much more affordable deal than you may have been able to gain when applying alone