Many businesses today find it challenging to obtain the financing they need for the commercial equipment they want in order to grow and/or remain competitive in their markets. To help business owners navigate through today’s financial markets, we are pleased to provide the following guidelines:
- A minimum of 2 years ownership is required. Even if the business has been in operation for many years, most lenders will still require that current ownership have been the owners for at least the last 2 years.
- The personal credit scores of the owner(s) should be at least 650. The credit score represents the history of a person’s ability and/or willingness to pay financial obligations in a timely manner. This score is used by lenders to try and determine the financial risk of lending money to an individual.
- The business PAYDEX score should be at least 65. Paydex is a term used in business and it is a numerical score granted by Dun & Bradstreet reflecting the timeliness of the businesses’ payments.
- A track record of profitably owning and operating the same sort of business is very important.
- A cash flow sufficient to make the loan payments made evident through business bank statements.
- Personal income proportionate to the amount requested to finance.
- Available revolving credit must be 60% or more. Revolving credit does not have a predetermined number of equal payments unlike installment credit loans. Revolving credit is most typically associated with credit cards.
- Bankruptcies and/or tax lines are problematic.
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