Equipment Financing Types – Restaurant Equipment
In general their are two types of equipment financing for restaurants; equipment leases and equipment loans. When making a decision to finance restaurant equipment it is important to understand the nuances of equipment financing types.
Equipment Lease vs. Equipment Loans
With most restaurant equipment leases the business is ‘renting’ equipment for a period of time and then buying out the restaurant equipment for its retail value at the end of the restaurant equipment lease. The problem with a restaurant equipment lease is that the buyout is usually at the current retail value of the equipment while the borrowing power of the asset is only at its liquidated value.
Using a restaurant equipment lease is kind of like buying a car on a lease, once you go down this path you are pretty much stuck there for the duration of your business because you will constantly be ‘renting’ your equipment. However with restaurant equipment loans/business loans you own the restaurant equipment. Granted, restaurant equipment loans and restaurant business loans in general usually have higher payments but getting through that initial pain and upgrading equipment or purchasing badly needed equipment that one owns is a much better avenue.
Short-Term Restaurant Equipment Financing
Short-term restaurant equipment financing is meant to provide the investment a restaurant business owner needs to purchase equipment and create efficiencies that drive profits rapidly. Short-term restaurant equipment financing can help owners by giving them 100% of they money they need and having that loan paid off in as little as 18 months vs. leases that can go on for up to 5 years and be very difficult to get out of when a piece of equipment goes bad.
While the payback is aggressive, the profit created from having new, more efficient equipment that helps get food out faster and turn tables in shorter time periods means more profit in the end. Additionally, it also means you are not paying hard earned profit dollars to pay for equipment over a long period of time that is worn out and broken.
To find out more about restaurant equipment financing from FastLoans.capital and how those short-term loans can help you accomplish your goals, contact us, apply online or click here to get your questions answered fast!
FastLoans.capital provides small business loans and equipment financing for restaurant businesses in all 50 states along with our partner companies and parent company Dividend America Commercial Lending. Currently focused on small business loans in the major markets and submarkets listed in the S&P Case Shiller Home Price Index: Boston, Chicago, Denver, Las Vegas, Los Angeles, Miami, Fort Lauderdale, Orlando, San Diego, New York, San Francisco, Phoenix, Atlanta, Tampa Bay, Detroit, Minneapolis-Saint Paul, Charlotte, Dallas / Fort Worth, Portland, Seattle, Cleveland, Oklahoma City, Jacksonville, Indianapolis, Nashville, Kansas City, Louisville, Milwaukee, New Orleans, Philadelphia, Raleigh, Sacramento, Salt Lake City, San Antonio, San Jose, Saint Louis, Tucson, Austin, Baltimore.