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Power Up Your Business: Everything You Need to Know About Equipment Finance in Australia


Excavator for equipment leasing

Expanding your business often requires acquiring new equipment, but upfront costs can be a major hurdle. That's where equipment finance comes in, a powerful tool that helps businesses access the equipment they need without straining cash flow. But before you dive in, understanding the qualifications and key considerations is crucial.


 

What is Equipment Finance?

Equipment finance allows you to obtain equipment through financing options like loans, leases, and hire purchases. Essentially, you pay for the equipment in installments rather than a lump sum, freeing up your working capital for other needs.

 

Who Qualifies for Equipment Finance?

Eligibility varies depending on the lender and your business profile. Here are some general qualifications:


  • Registered business: You must be a registered and operational business in Australia.

  • Good credit history: A strong credit score demonstrates your ability to manage debt responsibly.

  • Sound financial health: Lenders will assess your business's financial stability and profitability.

  • Deposit: Some lenders may require a deposit, depending on the equipment value and your financial strength.

  • Industry experience: Expertise in your industry and a proven track record can enhance your application.

 

Things to Remember before Applying:

  • Define your needs: Clearly identify the equipment you need and its intended use.

  • Shop around: Compare rates, terms, and conditions from different lenders to find the best deal.

  • Understand the agreement: Read the fine print carefully to grasp interest rates, fees, and repayment terms.

  • Consider tax implications: Consult an accountant to understand potential tax benefits associated with equipment finance.

  • Match finance to equipment lifespan: Align the repayment period with the equipment's useful life.

  • Factor in maintenance costs: Budget for ongoing maintenance and repairs alongside your finance payments.

 

Additional Considerations:

  • Equipment type: Different lenders specialize in specific equipment types (e.g., agricultural, medical).

  • Security: The equipment itself often acts as security for the loan, minimizing the need for additional collateral.

  • Tax benefits: Depreciation benefits may be available depending on the equipment and finance structure.



By understanding the qualifications and key considerations, you can leverage equipment finance to empower your business growth. Remember, careful planning and choosing the right lender are crucial for success. Speak to a finance broker to tailor a solution that meets your specific needs.

 


Get your pre-approval today!



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