Equipment sale-leaseback hard money may be the perfect solution for small businesses in need of immediate cash flow. This type of financing allows businesses to sell their equipment and then lease it back, using the proceeds from the sale as working capital. The advantages of this type of financing are numerous.
First, it provides businesses with much-needed cash flow when they need it most. Second, it uses the value of the assets as collateral, and no business or personal credit. And third, it can be quick, with funding in as little as a couple of weeks. If your business requires immediate cash flow, equipment sale leaseback hard money may be the perfect solution. As always, talk to your CFO or tax advisor to see if this type of financing is right for you.
What Sizes of Transactions Are Common?
Deal sizes generally start at $10,000 and go into the millions. It will all depend on the value of your equipment and the lender you are working with.
How Does it Work?
The first step is to submit your list of assets to get a value. Based on this value, the lender will make an offer of a percentage of the assets buy equipment from you, then structure a lease agreement. This means you can continue to use your equipment while getting a fresh cash injection.
How can equipment sale leaseback hard money help my small business?
If you’re a small business owner in need of some quick cash flow, then equipment sale leaseback hard money may be the perfect solution for you. With this type of financing, you can sell your equipment and then lease it back from the buyer, using the proceeds from the sale to fund your business needs. This can be a great way to get the funding you need without having to take out a loan or put up collateral.
What are the benefits of equipment sale leaseback hard money?
One of the great benefits of equipment sale leaseback hard money is that it can provide funding for your business without having to take out a loan. This means that you won’t have to worry about qualifying for a loan or dealing with interest rates. Additionally, because you are essentially selling and leasing back your equipment, you can qualify on the value of the equipment.
Getting Started
If you’re considering equipment sale leaseback hard money as a financing option for your small business, the first step is to submit your list of equipment to get a valuation and offer from a lender.
You will need to complete an asset list like the one shown above for the underwriter to review and confirm the value of the equipment.
After a review of your asset list and the type of equipment it is, the underwriter or broker will send you an offer based on a percentage value of your equipment. Oftentimes, this number may be different than the estimate you provided. In addition to the purchase offer, they will also include the terms of the lease agreement. These can vary from 2 to 5 years, and sometimes longer. There are a lot of factors that go into these underwriting decisions.
The next step is to confirm the ownership and condition of the equipment. Oftentimes, the lender will order an appraisal that will be used to confirm both condition and valuation. After this comes back, the final documents can be prepared and set.
Although this will be structured as a lease and not a loan, some customers like to know their effective interest rate. Rates on these types of deals are generally higher than national averages.