The Costs and Terms in Construction Equipment Financing
The Costs and Terms in Construction Equipment Financing
In case of default, the equipment secured lender has the option of seizing and selling the equipment to recover lost finances. This security allows them to grant favorable terms to borrowers. Below are the costs and terms involved in construction equipment financing.
Financing Amounts
For heavy equipment financing, you will be able to acquire funds for 100% of the equipment you are hoping to purchase for your company. The maximum benefits will obviously be available to the best borrowers. In case of low cash reserves, low revenues, low credit, or older equipment, you may have to provide a down payment. The percentage will depend on your credit score and the quality of equipment you are looking to purchase.
Repayment Term Lengths
The repayment term period will be decided by the type of equipment you are planning to buy. In other words, you will repay the heavy equipment financing during the life of the equipment you are buying. In most cases, the term of the small business loan does not exceed the beneficial life of the equipment.
