The best equipment loans for bad credit should offer low credit score requirements, quick access to funding, and good customer service. While you may not qualify for a lender’s lowest rates with bad credit, these loans should still be able to offer competitive rates and terms compared to other lenders. Here are our top picks for the seven best equipment loans for bad credit.
Best Brokers for Equipment Loans for Bad Credit:
- Smarter Finance USA: Best overall broker for flexible qualification requirements
- Lendio: Best broker for low revenue or newer businesses
- Clarify Capital: Best broker for multiple loan options
Best Providers for Equipment Loans for Bad Credit:
- National Funding: Best overall provider for smaller financing needs
- SBG Funding: Best provider for longer-term financing options
- First Capital Business Finance: Best provider for personalized loan options
- Balboa Capital: Best provider for fast approval and funding speeds
Get a business loan in 24-48 hours with Clarify Capital. |
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Best Equipment Loans for Bad Credit at a Glance
Provider | Maximum Loan Amount | Estimated Starting APR | Maximum Loan Term | Annual Revenue Requirement | Time in Business Required | Minimum Credit Score |
|---|---|---|---|---|---|---|
 | $1 million | 6% | 5 years | None | None | |
 | $5 million | 7.5% | 5 years | $50,000 | 520 | |
 | $5 million | 6% | 6 years | $120,000 | 6 months | 550 |
 | $150,000 | 15% | 5 years | $250,000 | 6 months | 600 |
 | Up to 100% of equipment value | 7 years | $350,000 | 6 months | 600 | |
 | $3 million | 19% | 5 years | $96,000 | None | |
 | $500,000 | 5% | 5 years | $100,000 | 12 months | 620 |
Smarter Finance USA: Best Overall Broker for Flexible Qualification Requirements
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Rates & Terms | |
Estimated Starting APR | 6% to 20%+ |
Loan Amount | $10,000 to $1 million |
Repayment Term | 24 to 60 months |
Repayment Schedule | Weekly, monthly, seasonal, and deferred |
Funding Speed | 2 to 4 days from time of application |
Qualifications | |
Credit Score | None, but 600 is recommended |
Time in Business | None |
Annual Business Revenue | None |
Minimum Down Payment | 0% to 35%, plus a $399 documentation fee |
Why We Like Smarter Finance USA
Smarter Finance USA is our top broker since it has some of the most flexible qualification requirements in our guide, as it has no minimums for credit score, time in business, or annual business revenue. It reviews applications on a case-by-case basis in an effort to maximize your approval odds based on your company’s unique strengths.
It specializes in equipment financing for bad credit and is a broker with nearly 40 lenders in its network. Working with a broker can simplify the loan process for you, as you can utilize the team’s expertise to match you with a lender willing to issue funding.
Equipment financing is available for a wide range of business uses. Some examples include heavy equipment financing, such as for excavators, cranes, and backhoes. Financing for vehicles and trucks is also available. Smarter Finance USA can issue funding in nearly any industry, including those in healthcare and food service.
To apply, you can visit the Smarter Finance USA website. Applications can typically be completed in under 10 minutes, with funding to follow in two to four days.
Lendio: Best Broker for Low Revenue or Newer Businesses
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Rates & Terms | |
Estimated Starting APR | 7.5% and up |
Loan Amount | $5,000 to $5 million |
Repayment Term | 1 to 10 years |
Repayment Schedule | Monthly |
Funding Speed | As fast as 24 hours |
Qualifications | |
Credit Score | 520 |
Time in Business | None, but 12 months is recommended |
Annual Business Revenue | $50,000 |
Minimum Down Payment | Varies |
Why We Like Lendio
Lendio is a loan broker with over 75 lenders in its network and offers excellent customer reviews, flexible loan terms, and a wide range of eligibility criteria. Working with Lendio, you can apply for a variety of financing options with a single application and be paired with a funding specialist. This individual will learn about your specific needs and qualifications to match you with a lender that is best suited for your business goals.
You can get equipment financing for nearly any industry. Some examples include:
- Farm equipment
- Trucking loans and commercial vehicles
- Construction and heavy equipment
- Medical equipment
- Gym equipment
- Restaurant equipment
One thing borrowers should note is that while Lendio states that it can lend to businesses with zero months’ time in business, it can be especially difficult to qualify if you also have bad credit. As a result, we recommend borrowers with bad credit to have at least 12 months of being in business to boost their odds of getting approved. Notably, it has a low annual revenue requirement in comparison to other options in this guide, making it our choice for newer businesses or those with limited revenue.
To apply, you can visit the Lendio website, and applications can usually be completed within minutes. If additional information is needed, you’ll be contacted by either phone or email. It’s important that you watch for these communications as your loan application will not be considered complete until you have provided all requested documents.
Clarify Capital: Best Broker for Multiple Loan Options
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Rates & Terms | |
Estimated Starting APR | 6% |
Loan Amount | Up to $5 million |
Repayment Term | 2 to 6 years, but can vary |
Repayment Schedule | Monthly |
Funding Speed | 1 to 2 days |
Qualifications | |
Credit Score | 550+ |
Time in Business | 6 months |
Annual Business Revenue | $120,000 |
Minimum Down Payment | 0% |
Why We Like Clarify Capital
Clarify Capital is a broker that has over 75 lenders in its network, similar to Lendio. However, Clarify Capital is our pick as the best for multiple loan options because of its lower starting rates and potential for longer loan repayment terms in comparison with Smarter Finance USA and Lendio.
In addition to the qualification requirements listed above, you’ll need to have a business bank account so that your business income can be verified, as Clarify Capital will require at least three to four months of statements. If you don’t have a business bank account, you can check out our recommendations for the best business checking accounts.
Funds from a Clarify Capital equipment loan can be used for almost any business-related purpose. Loan proceeds can be used to purchase computers, furniture, construction equipment, farming equipment, vehicles, and much more.
To learn more or to apply, visit the Clarify Capital website.
National Funding: Best Overall Provider for Smaller Financing Needs
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Rates & Terms | |
Estimated Starting APR | 15% and up (factor rates as low as 1.10x) |
Loan Amount | Up to $150,000 |
Repayment Term | 24 to 60 months |
Repayment Schedule | Monthly |
Funding Speed | As fast as 24 hours |
Qualifications | |
Credit Score | 600 |
Time in Business | 6 months |
Annual Business Revenue | $250,000 |
Minimum Down Payment | None |
Why We Like National Funding
While National Funding offers the lowest maximum loan amount on our list, the provider offers a high level of customer service and personalized service for its customers. For those reasons, we selected it as the best option for businesses with smaller funding needs.
It retains the majority of its loans in-house rather than brokering them out to other lenders. Applications are reviewed on a case-by-case basis, and you’ll work with a dedicated funding specialist who will match you with a loan based on your needs and qualifications. As part of the application, you’ll need to be prepared to provide an equipment quote from a vendor. Businesses with a long track record of performing well financially have the best chances of getting approved.
National Funding typically specializes in short-term financing. As such, it offers an early payment discount of up to 6% on the remaining balance when you pay off your equipment loan early. Before getting a loan, business owners must also agree to a personal guarantee, which is required for all its equipment loans regardless of your business qualifications or the strength of your loan application.
To learn more or to submit an application, visit the National Funding website.
SBG Funding: Best Provider for Longer-term Financing Options
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Rates & Terms | |
Estimated Starting APR | Varies, starting at 3.75% |
Loan Amount | Varies, up to 100% of equipment value |
Repayment Term | 1 to 7 years |
Repayment Schedule | Monthly |
Funding Speed | As fast as 48 hours from time of application |
Qualifications | |
Credit Score | 600 |
Time in Business | 6 months |
Annual Business Revenue | $350,000 |
Minimum Down Payment | 0% |
Why We Like SBG Funding
SBG Funding has the longest repayment term out of all the providers we’ve selected. This is what makes it our best choice for borrowers looking for longer-term equipment financing options and makes it a good option if you want to lower your monthly payments by spreading your loan over a longer period.
If you plan on doing that, keep in mind you’ll be paying more interest charges over the life of the loan. SBG Funding also advertises its rates as an average monthly fixed percentage. The rates and terms you get may vary depending on the strength of your business credit and finances.
Borrowers should also note that meeting the minimum qualification requirements listed above will not guarantee a loan approval. This is something true of many other lenders. Loan applications that are close to the minimum eligibility criteria may need other compensating factors to boost your odds of approval.
You can visit the SBG Funding website to apply, learn more, or contact a member of the team for any questions you may have. Online applications can be completed in just several minutes, and you can streamline this process by having the last four months of business bank statements ready to send. SBG Funding also does not perform a hard credit pull at any point during the approval process.
First Capital Business Finance: Best Provider for Personalized Loan Options
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Rates & Terms | |
Estimated Starting APR | 19% to 35% |
Loan Amount | Up to $3 million |
Repayment Term | 12 to 60 months |
Repayment Schedule | Monthly |
Funding Speed | 24 to 48 hours |
Qualifications | |
Credit Score | None |
Time in Business | None, but 6 months is recommended |
Annual Business Revenue | $96,000 |
Minimum Down Payment | Varies |
Why We Like First Capital Business Finance
First Capital Business Finance has the ability to issue equipment financing to business owners with bad credit as it places a larger emphasis on a company’s income, industry type, and time in business. It offers financing for all types of business equipment, with a minimum auction value of $20,000, including commercial trucks, vehicles, construction, office, and heavy manufacturing equipment.
A unique aspect of this provider is the fact that it can issue financing to brand-new businesses with no minimum credit score or time in business. After Lendio, it offers one of the lowest annual revenue requirements of this guide. We do, however, recommend that you have a history of at least six months to boost your approval odds.
Working with this provider will also allow you to partner with the firm’s financial experts for personalized guidance and strategic insights to help your business. For this reason, it’s our recommendation for borrowers with bad credit seeking personalized loan options. You’ll have assistance throughout the loan process, including getting tailored solutions for your circumstances, transparent loan terms, and a quick approval and funding process.
To apply, visit the First Capital Business Finance website.
Balboa Capital: Best Provider for Fast Approval & Funding Speeds
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Rates & Terms | |
Estimated Starting APR | 5% to 20% |
Loan Amount | Up to $500,000 |
Repayment Term | 24 to 60 months, but may vary |
Repayment Schedule | Monthly |
Funding Speed | As fast as same day |
Qualifications | |
Credit Score | 620+ |
Time in Business | 1 year |
Annual Business Revenue | $100,000 |
Minimum Down Payment | None |
Why We Like Balboa Capital
Balboa Capital can offer some of the fastest approval and funding speeds out of all the lenders in our guide. From start to finish, it’s possible to get funding on the same day that you apply—whereas you might have to wait until the next business day with providers like Lendio and National Funding.
Depending on when you submit an application, one-hour approvals are available during regular business hours. The downside, however, is that Balboa Capital does have the highest minimum credit score requirement on our list.
This provider can do this because it offers a streamlined application-only process under certain circumstances. Applications for hard collateral under $500,000 and for soft collateral for up to $350,000 are eligible for this reduced documentation process.
Submitting an initial application to this provider will not affect your score as Balboa Capital conducts a soft credit pull to determine if you might qualify. If you don’t, no additional credit pulls will be done. To apply, you can visit the Balboa Capital website and complete a form with your business information and the details of the financing you need.
How We Chose the Best Equipment Loans for Bad Credit
The following items were considered in our selection of the best equipment loans for bad credit:
- Minimum credit score requirement
- Other qualification requirements, such as revenue and time in business
- Interest rates and estimated APRs
- Loan amount and repayment terms offered
- Application, approval, and funding speeds
- Ease of application
- Documentation requirements
- Down payment requirements
- Customer reviews and ratings
How to Choose an Equipment Loan Lender
When choosing a lender for an equipment loan, ensure you work with one that fits your budget and business needs. Keep the following factors in mind when shopping around.
- Determine your business needs: Depending on your business needs, ensure equipment financing is your best option before proceeding with an application. Consider what kind of equipment you may need to fulfill business operations, how you plan to repay the loan, and if it fits your budget.
- Consider lender qualification requirements: Qualification criteria will vary per lender and will often include factors such as credit score, time in business, and annual income of your business. See to it that you meet the minimum eligibility requirements for a better chance of approval.
- Compare loan costs and terms: You’ll need to ensure the financing you seek is within your budget. You should review loan terms and associated costs when shopping around for a lender, inclusive of a down payment and the monthly repayment amount.
Alternatives to Bad Credit Equipment Loans
Equipment loans are specific to the acquisition of equipment for business purposes. They may come with higher interest rates than other business loans, so if you’re looking to explore all of your financing options, be sure to consider the following alternatives:
- Equipment leasing: An equipment lease allows you to rent business equipment for a limited period of time. Once the lease expires, you must return the equipment. You can read our guide on equipment financing to determine whether a loan or lease is better suited for your business.
- Small business line of credit: A small business line of credit acts as a revolving credit facility, in which you can request a draw, have the funds deposited to your account of choice, and repay the balance over time. You can use it on an as-needed basis, with limited restrictions as long as the funds are used for business purposes. Check out our list of the leading small business lines of credit.
- Rollover for business startups (ROBS): A ROBS gives you access to your personal retirement accounts without having to pay taxes or early withdrawal penalties. You can avoid monthly payments and interest charges that you’d otherwise be paying on a loan. We recommend using a company from our list of the best ROBS providers to walk you through this process.
- Invoice factoring: Invoice factoring provides financing opportunities for businesses that allow them to sell their invoices to sustain cash flow. This can be a good option if you are awaiting payment from customers but need funds more quickly to use for other areas of your business. To start, see our top-recommended invoice factoring companies.
- Home equity line of credit (HELOC): Similar to a business line of credit, a HELOC is a revolving credit facility based on the value of your home. You can use it with limited restrictions and on an as-needed basis. For more information, check out our guide on using a HELOC to fund your business.
Frequently Asked Questions (FAQs)
Yes, you can qualify for financing with bad credit if you can show other strengths in your loan application. You can do this by agreeing to a large down payment or setting aside cash to be used as a security deposit. However, the rate you can get will depend on several other items, such as your time in business, the type of equipment being financed, and business revenue.
Equipment financing can have restricted uses and may be subject to higher rates and fees than other types of business loans. However, they can be useful if you need to acquire a piece of equipment that will benefit your business operations on a daily basis.
Yes, equipment financing is considered debt. Since you’re borrowing money from a lender to finance the acquisition or repairs of a piece of equipment, you’re obligated to repay the lender over time, typically with a monthly principal and interest payment.
Bottom Line
The best equipment financing for bad credit should offer low credit score requirements, competitive rates and terms, and good customer service. With the right lender, obtaining an equipment loan for borrowers with bad credit is possible, and our guide can provide you with various lending options to support your business financing needs.
