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Getting credit for your growing business: Five C’s that count

(2 min read)

We talk to business owners every day about their financial situations and their need for equipment to grow or even stay in business.

For those new to equipment leasing and looking for an alternative to a traditional lender, there are important criteria that can help in securing your equipment lease deal:

  • Financing new vs. used
  • Financing equipment that retains value vs. equipment that immediately depreciates
  • Nature of financing:  vendor vs. private sale vs. sale leaseback
  • Reason for equipment acquisition:  replacement vs. expansion, etc.
  • Current with CRA, financials, etc.

Business owners who know and understand the criteria typically used to approve an equipment lease or sale & leaseback deal will be more likely to be approved.

Considering equipment lease financing? Arbutus Capital's top five credit criteria:

1. Character.

How have you managed your business finances? And more specifically, how have you dealt with repayment challenges in the past? Have you done what you said you will do? Unlike traditional lenders, your credit rating is not the most important criteria to Arbutus. What matters to us is your character.

2. Cash flow. 

What is your ability to repay the funds you are borrowing? How will this new request affect or improve your cash flow situation?

3. Collateral. 

What assets are you willing to use as collateral? Collateral may be property, equipment or money down, and they help provide assurance that you will repay your lease by sharing some of the risk.

4. Conditions.

Lenders will want to understand why you need the equipment. Is the equipment you want revenue or non-revenue producing?  Will the equipment be a replacement to expand your business?  What economic conditions exist that may impact your industry or region.

5. Communication.

Will you keep us apprised of challenges or opportunities that have impacts on your business and your ability to deal with debt?

These five criteria are only part of the evaluation we do. What’s important to us is getting to know you, your business and your plan for the equipment. Arbutus Capital lease customers know we work hard to find a way to approve their lease application if it makes sense for all concerned.

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Resources for small business owners:

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