Even if your credit isn’t perfect, you can still get the equipment your business needs. Online lenders offer flexible equipment financing options for business owners with bad credit — though they’ll still check your credit history when you apply.
Be wary of any company that promises “no credit check” or “guaranteed approval.” Those claims can be red flags for scams or predatory lenders.
How much do you need?
We'll start with a brief questionnaire to better understand the unique needs of your business. Once we uncover your personalized matches, our team will consult you on the process moving forward.
Why equipment financing requires a credit check
Equipment lenders require a credit check to evaluate your financial history and determine your risk of defaulting on a loan. They use this information — along with your other credentials — to decide whether to approve your application. It also helps them set your interest rate and repayment terms.
But equipment lenders may be more flexible than you expect. The equipment itself serves as collateral on your small-business loan, so lenders don’t always weigh your credit history and time in business as heavily.
How to get equipment financing with bad credit
Some equipment lenders, including two on our list, provide funding to small-business owners with personal credit scores in the 500s. The tradeoff is higher interest rates, shorter repayment terms and a larger down payment.
For example, based on the online equipment lenders we selected for this page, borrowers with scores in the mid to upper 500s are looking at APRs in the range of 22% to 35%. Compare that with meeting a slightly higher credit threshold in the low 600s, where you’ll see APRs in the upper teens. Borrowers with strong credit (high 600s into the 700s) — i.e. those most likely to be approved for bank or SBA loans — can see APRs as low as 4%.
“Bad credit” is a term used pretty variably depending on your source. FICO, one of the most widely accepted sources for personal credit scoring, uses this breakdown:
- 300 to 579: Poor.
- 580 to 669: Fair.
- 670 to 739: Good.
- 740 to 799: Very Good.
- 800+: Exceptional.
If you have bad credit, so a score in the poor to fair range, here are three tips to help you get equipment financing for your business.
1. Organize your business’s finances
First, organize your finances to understand your business’s qualifications and where you stand from a lender’s perspective.
Gather any documents that highlight your business’s strengths, like cash flow or annual revenue, especially if you’re concerned about your credit score. You can also prepare standard application documents such as bank statements, tax returns, profit and loss statements and balance sheets.
2. Strengthen your application
There are other ways you can enhance your credentials before submitting an application:
- Build your credit. Check your personal credit score (for free) and take steps to grow it to help your loan application. This includes disputing any errors on your credit report with the applicable credit bureau, making more frequent payments and paying down debt. You can also work on building business credit, which is a separate score from your personal credit score.
- Offer additional collateral. Although the equipment you’re purchasing serves as collateral on the loan, providing additional collateral can reduce the risk for lenders and increase their willingness to work with you. You can use property or other equipment to further secure your financing.
- Increase your down payment. Equipment lenders may require a down payment of up to 20%. If you can offer a larger down payment on your business loan, it may help increase your chances of approval, as well as lower your monthly payments.
- Get a co-signer. A co-signer with strong credit can help you qualify for an equipment loan if you have fair or poor credit. However, note that your co-signer will be held responsible for the debt if you can’t repay.
- Provide a detailed business plan. Not all lenders require a business plan for a loan application, but providing one gives additional insight into your company’s goals and strategies for achieving them. This information can help instill more confidence in the lender.
3. Research and compare multiple lenders
When looking for bad credit equipment financing, consider several different lenders to find the best deal for your business. As you evaluate your options, compare factors such as:
- Maximum loan amount.
- Repayment terms and schedule.
- Interest rates and fees.
- Collateral and/or down payment requirements.
- Funding speed.
- Application process.
- Lender reputation and customer support.
Bad credit business loans typically have higher interest rates and shorter repayment terms than other types of financing, so it’s even more important to evaluate the cost of the loan and make sure it’s something you can afford.
Equipment loan calculator
Best bad credit equipment financing options
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| Product | Max Loan Amount | Min Credit | Min Time In Business | |
|---|---|---|---|---|
 eLease - Equipment financing Nerdwallet Rating 4.0 with NerdWallet Small Business | Undisclosed | 550 | 6 months | with NerdWallet Small Business |
 Triton Capital - Equipment financing Nerdwallet Rating 4.0 with NerdWallet Small Business | $250,000 | 575 | 24 months | with NerdWallet Small Business |
 National Funding - Equipment financing Nerdwallet Rating 4.8 with NerdWallet Small Business | $150,000 | 600 | 6 months | with NerdWallet Small Business |
 JR Capital - Equipment financing Nerdwallet Rating 4.1 | $10,000,000 | 620 | 24 months | |
 CAG Truck Capital - Commercial truck financing | Undisclosed | Undisclosed | N/A |
eLease
Best for: Large loan amounts.
eLease doesn’t have a hard-and-fast annual revenue requirement, unlike most others on this list. This lender considers startups and lower-revenue businesses on a case-by-case basis. Plus, eLease is willing to lend a large amount of capital, as long as you can provide the necessary financials to qualify.
🗒️ Key details:
- Maximum loan amount: No maximum.
- Repayment term: 24 to 60 months.
- Interest rate: 7.5% to 22%.
- Speed: Within one business day of approval.
✅ Qualifications:
- Minimum credit score: 550.
- Minimum time in business: 6 months.
- Minimum annual revenue: No minimum requirement.
Triton Capital
Best for: Low starting rates.
Triton Capital stands out for offering both used and new equipment across a wide range of industries. Rates start as low as 5.99%, but the lender’s time-in-business requirement puts it out of range for startups.
🗒️ Key details:
- Maximum loan amount: $250000.
- Repayment term: 12 to 60 months.
- Interest rate: 5.99% to 34.99%.
- Speed: Within one to two business days of approval.
✅ Qualifications:
- Minimum credit score: 575.
- Minimum time in business: 24 months.
- Minimum annual revenue: $250000.
» MORE: How to finance used equipment
National Funding
Best for: Startups.
Startup owners with bad credit can turn to National Funding for fast equipment financing. The lender provides both equipment loans and leases. Plus, it offers a discount for borrowers who repay their loans early.
🗒️ Key details:
- Maximum loan amount: $150000.
- Repayment term: 24 to 60 months.
- Interest rate: Factor rates starting as low as 1.1 for borrowers that have excellent credit. You should always translate a factor rate into an APR to get a better sense of how much the loan actually costs. Use our calculator on this page to get a fast conversion.
- Speed: As fast as 24 hours.
✅ Qualifications:
- Minimum credit score: 600.
- Minimum time in business: 6 months.
- Minimum annual revenue: $250000.
JR Capital
Best for: No down payment.
JR Capital offers some of the longest repayment terms among lenders on our list. It also appeals for the huge financing maximum and rates starting as low as 5.99% And you can finance either new or used equipment with no down payment required. But it does have the highest minimum credit score among the lenders on this list.
🗒️ Key details:
- Maximum loan amount: $10 million.
- Repayment term: 24 to 84 months.
- Interest rate: 5.99% to 18%.
- Speed: Within 48 hours of approval (in some cases, same-day funding available).
✅ Qualifications:
- Minimum credit score: 620.
- Minimum time in business: 24 months.
- Minimum annual revenue: No minimum requirement.
CAG Truck Capital
Best for: Commercial truck financing.
CAG Truck Capital specializes in semi truck financing as well as loans for dump trucks and long hood trucks. This lender is especially attractive for bad-credit borrowers since it doesn’t require a specific credit score minimum to qualify. But if you fall into that category, be prepared to fork out a hefty down payment to offset the lender’s risk.
🗒️ Key details:
- Repayment term: 24 to 84 months (depends on the age of the truck and life expectancy of the engine).
- Interest rate: As low as 8.9% (startups and borrowers with bad credit may receive higher rates).
- Speed: Approvals as fast as the same day.
✅ Qualifications:
- No minimum credit score or time in business requirement.
- Annual revenue depends on the industry and is flexible for startups.
- Minimum 20% down payment. Startups and borrowers with a credit score under 600 may require an additional down payment.
Alternatives to bad credit equipment financing
If you can wait to apply for funding, developing your credit profile will help you access more affordable equipment financing options. On the other hand, if you need capital more quickly, you might consider these alternatives:
- Equipment leasing. Equipment leasing allows you to rent the equipment you need from a lender or vendor. You use the equipment for a set period of time and make monthly payments. At the end of your agreement, you return the equipment. You may also have the option to start a new lease or buy the equipment. Some equipment leasing companies can work with borrowers with bad credit.
- Short-term loans. These loans can be a good option for smaller equipment purchases that can be repaid in 24 months or less. Short-term loans are available from online lenders who typically have flexible qualification requirements. These loans can have high interest rates, however, and their frequent payments may impact cash flow.
- Microloans. These loans are typically offered in amounts up to $50,000 and issued by nonprofit or community lenders. Microlenders often have flexible qualifications and may be willing to work with borrowers who have bad or no credit. These organizations also tend to provide educational training and other resources for business owners.
- Small-business grants. Grants provide free funding that you can use for a variety of purposes, including equipment purchases. Grant applications can be time-consuming and competitive, but they don’t typically include a minimum credit score requirement.— This makes them a good bad-credit option if you can secure them.
- Merchant cash advances. With a merchant cash advance (MCA) you get a lump sum of cash. You repay the advance using a share of your debit and credit card sales, plus a fee. These products usually fund quickly and are easy to qualify for — even if you have bad credit. MCAs are also one of the most expensive types of business financing, however, and can create a cycle of debt that’s difficult to break. In general, you should consider all other loan options before a merchant cash advance.
Frequently Asked Questions
What is no credit check equipment financing?
No credit check equipment financing means a lender does not pull your credit history when evaluating your loan application. Most equipment lenders, however, require a credit check — even if they work with businesses with bad credit.
What credit score do you need for equipment financing?
You may be able to qualify for equipment financing with a credit score as low as 550. Because the equipment you’re purchasing serves as collateral on the loan, some lenders may not weigh your credit history as strongly when evaluating your application.
A stronger credit score, however, will help you qualify for an equipment loan with the most competitive rates and terms.
Is it hard to get an equipment loan?
Equipment loans can be easier to get than other types of small-business loans. The equipment you purchase serves as collateral on the loan, meaning you may not have to rely as heavily on other criteria, such as personal credit or time in business to qualify. Startups and businesses with bad credit may qualify for equipment loans.
Methodology
NerdWallet’s review process evaluates and rates small-business loan products from traditional banks and online lenders. We collect over 30 data points on each lender using company websites and public documents. We may also go through a lender’s initial application flow and reach out to company representatives. NerdWallet writers and editors conduct a full fact check and update annually, but also make updates throughout the year as necessary.
To come up with our list of the best equipment financing options for bad credit, we selected lenders with a minimum credit score requirement of 629 or less.
Our star ratings award points to lenders that offer small-business friendly features, including:
- Transparency of rates and terms.
- Flexible payment options.
- Fast funding times.
- Accessible customer service.
- Reporting of payments to business credit bureaus.
- Responsible lending practices.
We weigh these factors based on our assessment of which are the most important to small-business owners and how meaningfully they impact borrowers’ experiences.
NerdWallet does not receive compensation for our star ratings. Read more about our ratings methodology for small-business loans and our editorial guidelines.
