What is equipment financing?

Last updated May 2026 · Reviewed by David Chen
Quick Answer

Equipment financing is a loan specifically for purchasing business equipment, where the equipment itself serves as collateral. Loan terms run up to 60 months with APR of 6-25%. You can finance new or used equipment up to $2,000,000. May qualify for Section 179 tax deduction (up to $1.16M same year).

Key Details

  • Loan secured by the equipment itself
  • Terms up to 60 months
  • APR: 6-25% based on credit
  • Up to $2M financing
  • Equipment qualifies for Section 179 deduction
  • Bonus depreciation phasing out (60% in 2026)
Answer by David Chen — Senior Business Funding Editor
12+ years in alternative lending. $200M+ underwritten.

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