Alternative financing within the equipment financing industry can offer several advantages over banks. There are several reasons. Here are the main ones:
1) Private lenders tend to be alternative financing specialists. They find a specialty market in the lending and become experts within that market. In the case of heavy equipment most private lenders will focus on specific types of equipment. They lend only on this equipment and have deep knowledge of the equipment value, thus allowing them to lend the maximum amount against that particular type of equipment.
2) Private lenders are smaller funds or companies. This means they can respond more quickly to customer requests and also have more flexibility in lending, as a result they offer small borrowers more attention.
3) Private lenders are not subject to many of the federal regulations that banks are, therefore they can streamline their processes, making them more efficient. The customer benefits from an easier application process, thus getting a faster loan approval. They also have easier credit requirements, allowing them to lend when banks cannot.
Small companies need quick, efficient, and customized equipment financing solutions. Private lenders can offer the speed and credit flexibility to satisfy their needs.