After conducting much research and analysis, we recommend Crest Capital as our 2018 pick for the best alternative lender for equipment loans. To understand how we selected our best picks, see our methodology, as well as a comprehensive list of alternative lenders, on our best picks page.
Why Crest Capital?
Crest Capital has a simple application process, fast approvals, a variety of financing terms and excellent customer service. Here is a breakdown of why it's our best pick.
Application and Approval Process
Crest Capital requires you to only submit a simple application when financing less than $250,000. No other financial documentation is needed.
You have the option of filling out an application online or completing a paper version that you fax or email in. The application includes basic questions about you, your business and the equipment you want to finance. These are some specific questions:
- Company name, website and address
- Each company owner's name and Social Security number
- The percentage of the company that belongs to each owner
- The company's bank name and account number
- Estimated cost of the equipment
- The length of the loan or lease you want
- Condition of the equipment
- Name and address of the equipment vendor
The Crest Capital application can be completed online. You also have the option of filling our a paper version and faxing or emailing it in.
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There are several minimum requirements to even be considered for an equipment loan with Crest Capital. You must have a minimum credit score of 700 and have been in business for at least two years. The lender also checks public records, like Dun & Bradstreet and PayNet, to ensure you don't have any current delinquent payments or a history of nonpayment to creditors.
The lender reviews all of this information and usually has a final determination on approval within four hours. This is significantly faster than many of the other equipment financing lenders we examined.
Financing of more than $250,000 requires a more extensive application process. Besides your credit score and payment history, Crest Capital requires the following:
- A written overview of your organization (two pages max, plus brochures and/or resumes)
- A written description of the purpose of the equipment and financial justification of acquiring the equipment
- Last two year-end financial statements and current interim financial statement
- Tax returns for the two most recent years (unless financial statements are audited or reviewed)
- Last two years of tax returns on all entities and principals owning at least 20 percent of the company
- Current financial statement on all entities or principals owning at least 20 percent of the business
- List of current loans and leases (include lender name, account number and phone number)
Once you submit all of this information, Crest Capital usually makes an approval decision within one business day. This is considerably faster than many of the other lenders we looked into, which take up to two weeks to approve borrowers.
Part of what attracted us to Crest Capital was its wide array of financing terms. The company offers financing of up to $1,000,000, with term lengths of 24 to 84 months. The wide range of options lets you choose the financing structure that best fits your needs.
We like that Crest Capital lets you choose your own term length. The lender's flexibility means you can pick a repayment period that fits into your budget.
Crest Capital also lets you choose between an equipment loan and lease. The biggest difference between the two is the structure of the financing and what happens at the end of the term. These are some of the options available:
- Equipment finance agreement: This is a fixed-rate loan offering a monthly payment that does not fluctuate with treasury rates. At the end of the term, you own the equipment.
- $1 purchase agreement: With this lease, you have a fixed monthly payment, and you own the equipment at the end of the lease for a nominal amount, such as $1.
- 10 percent purchase option: This is a lease with a fixed monthly payment as well as a fixed purchase option. At the end of the lease, you can purchase the equipment at 10 percent of its original cost, renew the lease or return the equipment to Crest Capital.
- Fair market value: This offers the lowest fixed monthly payments. In addition, the payments are usually 100 percent tax deductible. At the end of the lease, you can purchase the equipment at fair market value, renew the lease or return the equipment to Crest Capital.
- Guaranteed purchase agreement: This provides a guaranteed purchase price for the equipment at the end of the term. You can choose a purchase price that is fixed at a certain dollar amount, or pick from a range between a fixed minimum and maximum amount.
- First-amendment lease: This gives you a purchase option at one or more defined points during the lease, with the requirement that you renew or continue the lease if the purchase option is not exercised.
- Operating lease: This meets the criteria established by the Financial Accounting Standard Board and is available for equipment with a strong after-market value. If you want to learn more about equipment leasing, we encourage you to check out our equipment leasing buyer's guide.
All of the financing structures can be combined with a variety of other payment options. These include step-up plans (lower payments early in the finance term and higher payments later), deferred plans (defer payment for up to six months) and seasonal plans (no monthly payments during seasonal businesses' slow periods).
Crest Capital also offers Section 179 qualified financing, which allows tax deductions on the cost of equipment. Under Section 179, small businesses can deduct up to $500,000, with a threshold of $2,000,000 for total equipment purchased for the year.
In addition to financing the equipment, Crest Capital can finance the soft costs associated with the equipment, such as the costs of delivery, tax and installation. Crest Capital covers soft costs that fail to exceed 25 percent of the total purchase price.
Since there are so many types of financing structures, it's impossible to say what your interest rate would be. Those rates are determined not only by the structure you choose, but also by the term length, your credit score, your time in business and the type of equipment being financed.
During our research, a Crest Capital representative quoted us an interest rate of 5.85 percent on $25,000 in financing for office furniture over a 60-month term. This is the only lender we spoke to that was willing to give us a quote over the phone when we hadn't filled out an application.
Besides the interest rate, the only fee Crest Capital charges is a $275 documentation charge. While most of the other lenders have a similar fee, Crest Capital's is among the cheapest.
After agreeing to a deal, Crest Capital immediately collects the documentation fee and first month's payment. The lender then purchases the equipment the next day from the vendor of your choice. Repayment is made on a monthly basis via an automatic withdraw from your bank account.
We were extremely impressed with Crest Capital's customer service. To test the customer support, we called the lender multiple times, posing as a business owner interested in equipment financing.
Each time we reached out to Crest Capital, a professional, pleasant and helpful representative immediately answered our call. Just having someone take our call was a step up from some of the other lenders we contacted, which sent us straight to voicemail.
Instead of trying to get information about our business and the equipment we wanted, the Crest Capital representatives allowed us to ask all of our questions first. Some of the other lenders we spoke to brushed aside our questions and immediately started gathering the information they wanted, like how much the equipment we wanted to finance was and the financial status of our business.
During all of our calls, the representatives we spoke to provided clear and detailed answers to each of our questions. Some other lenders we spoke with gave unclear answers that left us confused about exactly how their financing worked.
Crest Capital representatives are available via phone, email and online forms. The company's website features details on each of the lender's financing programs, a helpful FAQs section and a Section 179 calculator that gives you an idea of how much money you could save by using those tax-deduction options.The Crest Capital website features an extensive FAQ section that answers many questions your may have.
Crest Capital is an accredited member of the Better Business Bureau with an A+ rating. As of August 2017, there had not been one consumer complaint filed against it with the BBB in the past three years. Many of the other lenders we examined had at least some complaints filed against them.
The biggest drawbacks with Crest Capital are its requirements for minimum credit score and time in business. The requirement for at least a 700 Equifax score could eliminate some businesses from even being considered for financing. In addition, the company doesn't work with startup businesses.
Businesses that haven't been open for at least two years should consider our runner-up in this category, Amerifund. That lender offers five financing programs, including three for new and startup businesses. Amerifund provides financing of up to $75,000 for new businesses and $5,000,000 for business that have been in operation for at least five years. In addition, it makes credit decisions within two hours and offers same-day funding. We were also very impressed with Amerifund's customer service.
Similarly to Crest Capital, Amerifund has a spotless BBB record. The lender is an accredited member with an A+ rating and hasn't had any complaints filed against it in the past three years.
Ready to choose an alternative lender? Here's a breakdown of our complete coverage:
- A Guide to Choosing the Right Small Business Loan
- The Best Alternative Lenders for Businesses 2018
- Best Alternative Lender for Startup Loans
- Best Alternative Lender for Lines of Credit
- Best Alternative Lender for Merchant Cash Advances
- Best Alternative Lender for Bad Credit Loans
- Best Alternative Lender for Working Capital Loans
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