Choosing Low Doc Equipment Finance? Facts To Know

By Author: Callum Bini
Total Articles: 61
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Having the right equipment is essential to running any business, however, with the fluidity of the business world it can be difficult to stay up to date on the most up-to-date equipment and technology without breaking the bank. Low doc equipment finance can provide business owners with additional funding to help get the equipment their business needs. Here are some facts to know about low doc equipment finance, and how it can benefit you and your business.
 
Today, more and more people and businesses are turning to low doc equipment financing as a way to purchase large, expensive items like cars and trucks, furniture, and office supplies. This is appealing to those who don’t qualify for traditional bank loans, and it has a number of beneficial features. Because of its increasing popularity, it is becoming important to understand what it is, who it is suitable for, and what to consider when choosing it.
 
What is low doc equipment finance? Low doc equipment finance, or low documentation finance, is a funding solution ...
... designed to provide businesses with quick and easy access to the funding they need to acquire the necessary equipment they require. Low doc finance involves less paperwork in the application process and often comes with quicker decision turnaround times. Additionally, this type of funding typically requires less collateral than other funding options, making it a great solution for businesses that need the funding fast.
 
Low doc equipment financing is a type of financing with largely lenient requirements, making it ideal for those who may have a limited or poor credit history, self-employed individuals, or those who are unable to provide the documentation commonly associated with traditional bank loan applications. Low documentation financing requires significantly less paperwork than is needed for a traditional loan from a bank; that often only includes the borrower’s name and address, proof of income, and an agreement to purchase the equipment are needed. This makes it accessible to those who may not be able to provide all of the information normally required for a traditional loan.
 
What types of equipment does it cover? Low doc equipment finance typically covers a variety of business equipment including software, hardware, furniture, vehicles and more. Make sure to check with the company you are considering to see what types of equipment are eligible for low doc financing. Once you have determined what type of equipment is covered, you should look into the repayment terms. This type of financing typically comes with flexible repayment terms, so you can choose to repay over the term of the lease or over the life of the equipment.
 
When considering low doc equipment financing, it is important to be aware of the potential disadvantages. First, the terms of the financing may not be as favourable as those on a traditional loan; the interest rate may be higher, the repayment timeline shorter and payments more frequent, or the credit limit lower. Additionally, since a credit check is typically not done, the lender may put other restrictions or requirements on the loan, such as a requirement for collateral or a co-signer. Finally, the repayment schedule may negatively affect the borrower’s credit score, so it’s important to be aware of the potential downsides and make sure the financing is handled responsibly.
 
For those who need to purchase expensive equipment and who cannot get a traditional bank loan, low doc equipment financing may be an appealing option. It is relatively easy to qualify for and does not require extensive paperwork. However, it is important to be aware of the potential downsides and disadvantages of low documentation financing, as well as the factors to consider when choosing it.
 
About the Author: This contribution has been made by Callum Bini who has written a number of articles on low doc equipment finance and provides fruitful information.