Equipment financing: plain-English answers

The equipment itself is collateral — that's what makes equipment financing easier to qualify for than a standard business loan. Here's how loans and leases compare, and what startups and bad-credit borrowers can realistically get.

What is equipment financing?

A loan or lease where the equipment itself is the collateral — which is why approval is easier and terms are longer.

Equipment loan vs equipment lease: which is better?

Buy if you'll use it 5+ years and want to own. Lease if the tech ages fast or cash flow is tight.

Can a startup get equipment financing?

Yes — the equipment itself is collateral, so time-in-business rules are looser. Expect a higher down payment.

How does semi truck financing work?

The tractor is the collateral. Lenders check the truck, your revenue, credit, and authority history. Worked payment example inside.

Can I get equipment financing with bad credit?

Often yes. Sub-600 FICO can still fund with 15–25% down and slightly higher rates.

How to approach equipment financing

Equipment financing uses the machine or vehicle itself as collateral, which is why it is often easier to get than an unsecured loan. Trucks, trailers and widely resold machinery are the easiest to finance; custom equipment is the hardest.

Decide first whether you want to own the equipment at the end (a loan) or keep upgrading (a lease). Then check the monthly payment against your slowest month, not your best one. A larger down payment usually improves both approval odds and price.

Through Outset Funding you need $10,000+ in monthly revenue and 6+ months in business; the lender sets rates, terms and approval.