Equipment Financing Do's: Pre-Approval

The Importance of Pre-Approval

Today’s shoppers are savvier than ever, diligently doing their homework before making a purchase by consulting smartphones and reading online reviews. Sometimes finding the right items is the most challenging part. After researching for days, weeks, or months, suddenly, the perfect product appears and you’re ready to buy… or are you?

If you’re in the market for an expensive piece of commercial equipment, you might not have the cash on hand to pay for it outright, or you may want to conserve your cash for any unexpected expenses that might occur, which means you’ll need to apply for a loan. Before or while you’re shopping, getting pre-approved for a loan is a smart move. Pre-approval is a quick and simple process that ensures you know whether you qualify for a loan – and the amount – before getting ready to make a purchase. Check out the great benefits of getting pre-approved below.

You are in the Know

If you get pre-approved for a loan, you’ll know exactly how much you qualify for and where you stand. You can take the first step in approaching the process by using an online calculator to estimate your rate and monthly payments. However, you should speak with a financing professional to understand exactly what you qualify for and confirm all details. Starting with an application will also give you time to familiarize yourself with the lending process and terms before making a purchase, especially if you’re a first-time loan applicant.

Shopping Within Budget

Pre-approval is also a practical way to ensure you stay within budget when shopping. Sometimes our preferences exceed our reality (i.e. champagne tastes on a beer budget), so obtaining pre-approval assists with keeping all estimated expenses in line. Plus, it allows you to stay focused on the type of equipment you can afford, narrowing down options and streamlining the search.

Expediting the Purchase

If you’re already pre-approved, you won’t need to line up financing after you’ve found the perfect piece of equipment. This also makes certain you won’t waste time at the eleventh hour figuring out how to afford your purchase and potentially losing out to another buyer, especially if you’re in the market for a used piece of equipment. Rather, the money will be there, ready and waiting, when you decide to buy…but only if you’re already pre-approved.

Peace of Mind

Having your finances in order before making a purchase allows you to have a less stressful buying experience. It also establishes credibility with the seller. Since you’re already pre-approved, you’ll look like a serious buyer and may have the upper hand when it comes to negotiating since your money is ready and waiting.

Pre-Approval is Easy

When applying for an equipment loan, there are several factors that go into the approval, including the amount borrowed, interest rate, and term length (typically 60 months). The amount of money you’ll be eligible to borrow depends on the type of equipment you’re purchasing, whether it’s new or used and your credit history. And it all starts with a quick credit application.

Reap the Gains!

If you get pre-approved and then decide not to purchase, no harm done. There is no obligation with pre-approvals and they typically expire within 60-90 days. When you’re ready to make a purchase, all you have to do is get reapproved.

So, what are you waiting for? Contact a financing professional at Oakmont Capital Services to learn more about pre-approval and equipment financing made easy!