WWJ Closeup, November 2026

CORY ALSIP
Civista Leasing & Finance
Vice President/Sales
Nashville, Tennessee

WHAT ARE SOME IMPORTANT TOPICS TO PREPARE FOR YOUR LENDER WHEN APPLYING FOR COMMERCIAL EQUIPMENT FINANCE?
Most important is the explanation of how the equipment impacts your business. Be prepared to tell the story. Does it generate new revenue? Does it create efficiency and save money? Does it replace or upgrade existing equipment? Does it serve a new customer or industry and diversify revenue sources?

WHEN IS IT MORE ADVANTAGEOUS FOR A BUSINESS TO CONSIDER EQUIPMENT FINANCE OPTIONS VERSUS PAYING CASH?
Opportunity cost is important to consider. What else could you do with the cash? Every business must manage expenses. The interest associated with an equipment loan should be considered the same as the expense of labor, fuel, insurance, etc. Don’t be left behind because you’re afraid of an expense.

WHAT SHOULD CONTRACTORS KNOW WHEN ASKING ABOUT ROLLING IN “SOFT COSTS” WHEN APPLYING FOR EQUIPMENT FINANCE?
Many equipment lenders are more than comfortable financing these costs (delivery, installation, training, etc.). The quicker the equipment is deployed into your business and generating revenue, the less risk for the lender. Try to obtain these costs and have them itemized on the equipment quote.

WHAT IS A DEBT SCHEDULE AND WHAT PURPOSE DOES IT SERVE IN THE CREDIT APPLICATION PROCESS?
A debt schedule details your obligations to various creditors. It should include creditor name, origination date, amount financed, current balance, interest rate, monthly payment, maturity date, collateral, etc. For example, it’s important for the analyst to know if something is going to be paid off in the near future.

ON WHAT CRITERIA ARE LENDERS EVALUATING POTENTIAL BORROWERS AND WHAT ULTIMATELY INFLUENCES THE DECISION-MAKING PROCESS?
All lenders are making decisions based on these factors called “The Five Cs of Credit”: character (history of repaying debt); capacity (ability to repay the obligation); capital (money or assets being invested into the purchase); collateral (value and cost of the equipment); and conditions (purpose of the equipment acquisition).

LASTLY, WOULD IT BE PRUDENT FOR A BUSINESS OWNER TO PAY CASH RATHER THAN CONSIDER EQUIPMENT FINANCE BECAUSE OF RISING INTEREST RATES?
Equipment is a revenue-generating asset. It pays for itself whether financed or not. It’s not the same as financing a new truck for personal use. Be informed and secure the best rate possible. But there are many considerations to make when making this decision. Interest rate is only one.