| When it comes to companies that specialize in | | | | 4. Good financials (bank statements AND/OR tax |
| lending money for equipment or homes or leisure | | | | returns that show a consistent cash flow). |
| products, it has to somehow make sense for | | | | 5. An established business (generally 2-3 years in |
| that entity to give you the money to get what | | | | business). |
| you want. Think about it logically, if you had a | | | | These are just some basics in terms of what the |
| limited amount of money and wanted to make a | | | | money dispensing entities look for prior to issuing |
| business out of lending it to people, wouldn't you | | | | their money for your business equipment. It |
| choose the same way? You've got this pool of | | | | comes down to this-what do they have to hang |
| money that you're hoping to use (lend to others) | | | | their hat on? Do all of these things look good? Do |
| to make more money. Right, the all mighty dollar. | | | | just some of these things look good? Are none |
| It seems to be a recurring theme. Home loans | | | | of these things looking good? If none of them are |
| are base typically on what's called the three C's. | | | | looking good, think about it logically. Think about it |
| These three C's are credit, capacity to pay, and | | | | like it was your small investment pool of your |
| collateral. If all three look good, it seems like a low | | | | hard earned money. Would you want to issue it |
| risk deal. This usually results in a yes and a | | | | to someone that didn't have any of these in line? |
| favorable rate. If two of the three C's look good | | | | It's doubtful. |
| and one does not, then it will likely result in a yes, | | | | Here's the good news. For those that don't have |
| but with a less favorable rate. If only one of the | | | | any of these ducks in a row, there is still a |
| C's looks good, the approval becomes more iffy | | | | program or two available. If you don't "got credit" |
| and of course the rate becomes less favorable. If | | | | (or any of the other things lenders look for), you |
| none of the three C's look good, then approvals | | | | can still lease your business equipment with a |
| are slim and if you find one, the rates aren't | | | | collateral based program. There are a number of |
| pretty. | | | | items that can be pledged as additional collateral. |
| Equipment leasing and financing are very similar, | | | | This includes raw land, real estate, other |
| but the folks that normally give out the money | | | | equipment you own outright, stocks, bonds, |
| look for different things. Here are some of the | | | | mutual funds, etc. The list goes on. |
| things they look for: | | | | If you find yourself in a position where you can't |
| 1. A Dun & Bradstreet rating (do you have | | | | get funding for the equipment you need to |
| any credit footprint in the business community?). | | | | purchase to get your business off the ground (or |
| 2. The highest possible personal credit rating for | | | | back in shape), perhaps a collateral based program |
| newer businesses that don't have business credit | | | | will work. These programs even work for sub |
| yet. | | | | five hundred credit scores and based on today's |
| 3. Re-marketable collateral in the event you | | | | credit market, that's pretty awesome. |
| default. | | | | |