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Finance and Lease Heavy Construction Machinery and Equipment, New and Used, Leasing and Financing Programs Update, Part1

By: J.M Luna

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Finance and lease are still accessible for new and used heavy construction machinery and equipment, however leasing and financing volume for the first part of 2010, was on the whole flat for most United States Industries.

Even though we are going through rough credit times, heavy construction machinery and equipment financing and leasing is still accessible for the good credit applicant and also for the not so good applicant. We are going to discuss the open finance and lease programs in general to give you an inspiration that funds is still open for start up and seasoned businesses.

First we are going to start with the candidate with great credit. That would be an applicant with 680 or higher credit and time in business that exceeds three years. The applicant should not have any prior bankruptcies and should have low debt ratios. This candidate can qualify up to $50,000 to $75,000 application only programs. Additionally, this gives the good credit candidate a good chance to acquire a great lending rate. If the candidate desires more than $50,000 to $75,000, they will have to present more documentation to qualify. This would include two years prior years business and personal income tax returns and the summary page of your last three months business bank statements.( high average bank balances are looked at favorable) A personal financial statement might be required as well as interim financial statements. A copy of the invoice detailing the acquisition would be required as well

Clientele with personal credit scores between 650 and higher still have a good opportunity to obtain their desired acquisition. They should have a minimum of three years in business without past bankruptcies. Low debt to income ratios are also looked at favorable. Additionally, some institutions still might offer application only programs and anything beyond the minimum application only levels would require the same documentation as above.

With the second tier credit described above, the rates will be a little higher than “A” Credit with huge heavy construction equipment financing and leasing opportunities accessible.

Applicants with Credit scores between 600-650, there are many heavy constrution machinery and equipment financing programs available without flawless credit. Even though there may be some dings on the applicant’s credit, there are still machinery, equipment financing and leasing opportunities out in the financial market. There won’t be application only programs but ample ofbankswill look at you. Once again, strong healthy bank balances with time in business with profitable operations showing on your tax return is a big plus… Usually, full documentation information is essential. The front money in these financial programs can run anywhere from 10-20% where as the first two programs can run as low as the first two payments..

There are other financial institutions that are not credit driven, but are story book driven. They work with start ups and seasoned businesses without perfect credit. They are more cash driven, and want some additional requirements to qualify. These lenders rates are higher than the programs described above but gives the applicant options that might nor be accessible elsewhere..

There are other financial institutions that are not credit driven at all but look at the free and clear assets that are on hand to the lender. Most lenders like machinery, bulldozers, trucks, excavators, etc that have retained a good value. These are cash poor applicants but have good qualified assets that the lender will qualify. These banks have their own blueprint to work out a financing. base. One should call to find out the particular details (Copies of free and Clear Titles are required).These finance and lease programs can finance up to $5,000,000 or more based upon qualified assets.

In this recession, many financial institutions have had to focus on their repossessed heavy construction machinery and equipment inventories instead of standard business due to cash flow demands, out of balance credit lines with their own institutions, and competing with other lenders for the small supply of buyers in the market place.

In the past better times, there were many application only programs up to $250,000 and $150,000. This meant there were no financial statements, tax returns or bank statements required. Today, there are less application only lending programs accessible, or the available programs require more information and their rate factors are higher than before. Due to problems in the industry, many institutions have gone back to more conventional lending wants. .

These lending changes have a tremendous impact on usual business for marginal credit buyers, start up businesses and more established businesses. One interesting area that has arisen out of this economic downturn is dealer/special financing. With all the repossessions in the market place today, buyers still have a unique business opportunity to acquire a construction equipment repossession with a credit score as low as 550. Construction machinery repossessions can be acquired with very little or no money down, sixty months to repay, regardless of age, and more favorable financing terms than conventional financing.

Since new business capital is tough to obtain, it is suggested that the start up and seasoned business examine the repo markets. This could be a pleasing in the combination of both price and financing.Remember, there are finance and lease programs that go into the millions for larger applicants, obvious they will require full documentation packages.

If conventional isn't accessible to you for whatever reason, please check out the repossession heavy construction machinery and equipment market and see what deals you may be eligible for.

Happy hunting for your heavy construction equipment and machinery acquisition and its related lending.

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Article Source: http://depositarticles.com/

J.M Luna has over thirty years experience in the financial field. This includes financing and leasing, hard asset money and commercial lending. U.S Corporate Capital Leasing assists the start up and seasoned businesses for all their construction financing needs www.cclgequipmentleasing.com/lease_construction.htm www.cclgequipmentleasing.com/lease_equipment.htm

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