Company News

5 Factors That Affect Equipment Finance Interest Rates

Loan Repayment

This Envision Capital Group blog article can help you better understand equipment finance interest rates; it looks at five factors that determine them.


1. National interest rates.
When national interest rates rise, banks and lending companies charge more for small business finances and business lines of credit. National interest rates, which are set by the Federal Reserve, typically increase when the economy is doing well.

2. The national economy.
As mentioned above, the U.S. economy impacts business finance interest rates. During times of strong economic growth, new businesses are started, existing businesses are expanded, and capital equipment investing increases. The goal of lower rates is to entice business owners to apply for finances or lines of credit so they can invest in their companies, and stimulate growth in the economy.

3. Your personal credit profile.
Many business owners are not aware that their personal credit profiles can be the deciding factor when trying to obtain a finance or line of credit. A good personal credit profile makes it easier to get approved, and it opens the door to lower interest rates and more repayment term options.

4. Your time in business.
Startups and businesses that are under two years old are seen as risky by banks and other lenders because they often lack capital, collateral, and business credit. There is no question that banks want to lend money to startups and younger businesses, yet they need assurance that they will get their money back. That’s why they have stringent approval requirements.

5. Your company’s financials.
Make sure you always monitor the financial health of your business. This will help you identify potential problems in your financial statements so you can maintain positive cash flow. An attractive balance sheet, cash flow statement, and profit and loss statement are what lenders want to see in a borrower.


Envision Capital Group LLC provides equipment leasing, equipment financing, and working capital loans to companies nationwide. Since 2007 we have helped thousands of companies secure the financing and equipment they need. Supported by the industry’s best team of professionals, our programs combine innovative finance tools, competitive rates, and fast turnaround. Our mission is to simplify the future of finance by creating tangible value and opportunity for our customers and vendor partners.