Your Guide To Commercial Equipment Financing
Whether you have a bakery serving breads, croissants and tasty sponge cakes or a manufacturing company making fast-selling notebooks and stationery, you know that your equipment plays a key role in the quality of your finished product. Taking care of your equipment and buying new equipment when needed is something that you as a business owner should be very aware of. Whether it is to outshine your competition, lower your manufacturing costs or create an innovative product, the right equipment can bring a host of advantages with it.
Though there is no doubt that you need to keep an eye on the latest equipment, do you have concerns when it comes to getting financial help to buy it? Don’t worry, because availing a equipment financing today is no longer a complicated process. In fact, as far as keeping your business equipment up to date is concerned, there are several lending entities willing to extend financial support towards acquiring new equipment or upgrading your existing ones. However, easy as it may be, it is imperative to take into account the necessity of the equipment towards which you are seeking financial help as well as your firm’s ability to repay the loan.
Also Read : How To Make The Most From Equipment Financing
Here are some questions you should ask yourself before you seek equipment financing:
Determine the utility of the equipment in your business:
The first step in business equipment financing is to determine how useful it will be for you and how long you will be using the equipment in question. The usage and utility will help you determine whether buying or leasing the equipment would be feasible or not.
Does your financer understand your needs?
It is equally important that the financer and you are on the same page as regards your business objectives. Do not hide any information from your lender. It should be fully aware of your company’s financial health in order to ascertain your requirements and how they need to be fulfilled.
How much will the financing cost you?
Before you sign any contract, make sure you understand how much the financing will cost you and that you have enough funds to meet this financial requirement when the time comes to repay.
Equipment finance rates and flexibility:
When applying for an equipment loan, choose a lender that gives you a loan that has nominal interest and flexible repayment options. Bajaj Finserv’s Equipment Machinery Loans offer you up to Rs.30 lakh on a tenor of 12 to 96 months at a fixed interest. They also offer a convenient line of credit for equipment purchase, which gives you the freedom to borrow what you like when the total credit limit and pay only interest as EMI.
It is important to note that when you go for equipment financing, you could also end up saving tax for your company as lease payments are fully deductible for some equipment. In terms of a loan, you may be entitled to tax savings on interest payments.
Also Read : Equipment Loans For Your Business Expansion
How to apply for an equipment loan?
As with any business loan, make sure your paperwork is ready and compiled well in advance. It’s helpful to have a detailed business plan that explains to the financer what your company’s prospects are and what the cash flow situation is. Usually you will need to submit proof of residence of business, bank statement, business proof, business vintage of at least 3 years and other KYC documents to avail an equipment loan.
When the time comes for you to upgrade your equipment or buy new ones enabling your business to access the latest technology, take a Machinery Equipment Loan from Bajaj Finserv.