When choosing a lender for your medical equipment loan, you should consider three factors:
- Do they pay the loan into your account, or do they work with the seller? Most lenders fund sellers directly and only allow you to buy from a handful of verified sellers. This limits your ability to shop around and get the best possible price. So, we recommend partnering with a lender that deposits the equipment loan into your bank account.
- What are the qualification requirements? Many lenders have strict requirements, such as large down payments, near-perfect credit, or long operating histories. This makes it difficult for most businesses to qualify. We suggest choosing a lender that uses common-sense underwriting and doesn’t require businesses to be in near-perfect condition to qualify.
- How much paperwork do they require? Reviewing paperwork requirements is a good way to predict a lender’s closing speed. Lenders that require endless paperwork usually take a long time to close. Choose a lender with minimal paperwork requirements, as they typically close more quickly.
In this article, we take a closer look at how Redline Capital’s medical equipment financing tackles the factors mentioned above: (1) borrowers receive funds directly in their account, (2) it’s easier to qualify than bank loans, and (3) we only require four months of bank statements, allowing us to fund on the same day you apply.
We conclude with five best practices for evaluating lender offers, enabling you to select the offer that best suits your business.
Redline Capital’s revenue-based financing options enable medical practices to secure funds quickly, lock in strong terms, and finance 100% of their equipment’s value. You can apply by completing this form and submitting four months of bank statements. We’ll send you several offers within a few hours, and you can close as early as today.
| Funding Features | Redline Capital Terms |
| Loan amounts | $30,000 to $2 million |
| Loan-to-value | 100% the equipment’s purchase price |
| Minimum time in business | 12 months |
| Minimum monthly revenue | $30,000 |
| Down payment requirements | None |
| Paperwork requirements | Just 4 months of bank statements |
Factor #1: Do They Deposit the Loan Into Your Bank Account?
Most lenders don’t deposit equipment loans directly into your bank account. Instead, you need to draw up an agreement with one of their verified sellers, and they fund the seller directly. This presents a few issues:
- You can’t purchase equipment from individual sellers. Banks require you to buy from one of their verified healthcare equipment sellers. You can’t, for example, purchase equipment from second-hand sellers, off Facebook marketplace, or from other healthcare providers.
- When the seller knows payment is coming directly from a lender and that you’re already approved for a certain amount, you have less leverage to negotiate. You can’t really bargain down without redoing all the paperwork.
- Sellers typically favor buyers who have cash because it means they don’t have to worry about financing and credit approval, which can cause you to lose out on good deals.
What sets Redline Capital apart from other lenders is that you get the funds deposited into your business bank account, which you can use to shop around for the best deals. This provides a lot of flexibility as you can easily negotiate with sellers and buy from anyone, including other doctors, or even opt for equipment leasing instead.
Factor #2: What Are the Eligibility Requirements?
Banks and most large lenders, particularly within their SBA loan programs, have strict requirements which means businesses who aren’t in near perfect condition don’t qualify.
Instead, we’ve structured our requirements so that most healthcare professionals can qualify:
- Earn $30,000 or more in monthly revenue.
- Have an operating history of 12 months or longer.
- Have a business location inside the U.S.
If you meet these three requirements, you qualify for a medical equipment loan.
With such straightforward requirements, you only need 4 months of bank statements to qualify. This speeds up underwriting on our end and allows you to receive your funds on the same day you apply, sometimes in as little as four hours.
Most lenders require never-ending paperwork, so they spend months underwriting, making it difficult for you to secure financing quickly.
In addition to quick, easy qualification, you can secure larger amounts than with traditional lenders. Again, that’s because we focus on your revenue, not collateral, cash reserves, or credit history.
You can qualify for financing worth twice your monthly revenue and the full equipment price. Most lenders cap funding at 50% of your monthly revenue and require large down payments.
Factor #3: How Much Paperwork Is Required & How Do You Apply?
You can apply for a Redline Capital medical equipment loan in four simple steps. The whole application process takes under five minutes, and you can get funded on the day of applying:
- Send us 4 months of bank statements and fill out a half-page application form, asking for basic details about your business, such as its revenue, operational history, required loan amount, and sector.
- We underwrite your application and send you multiple offers for medical equipment loans via email within one or two hours.
- Once you’ve chosen an offer, send us an email. We put no pressure on you to accept. Take all the time you need.
- You’ll receive funds immediately after choosing an offer, via wire transfer or ACH.
How to Choose the Correct Offer For Your Business: Differentiating Between High and Low-quality Offers
What Is the Cost of Borrowing?
The most important factor in a lender’s offer is the interest rate and APR.
At Redline Capital, borrowers can secure lower rates on medical equipment loans than with other lenders.
We’re a broker who has helped some of the most established lenders scale their lending business over the years by delivering thousands of applications to them. These lenders include Credibly, Rapid Finance, and On Deck, among others. In return for all this business, they give our applications lower rates, more flexible terms, and exclusive discounts.
So, when you apply through Redline Capital, you draw on all the business we generated for top lenders over the past decade to secure more favorable rates.
Read more: 5 Best Large Business Loans & How to Pick the Right One
How Long Is the Loan Term?
Another important factor to consider is the time in which you must repay the loan.
We recommend avoiding short-term financing because it will naturally have larger weekly or monthly payments, as the loan amount must be repaid in a shorter period of time. This puts unnecessary stress on your business’s cash flow.
For medical equipment loans, go for offers with terms of 1 to 7 years, as this spreads out your repayments over a longer period of time, resulting in smaller payments and less stress on your business.
At Redline Capital, our medical equipment loans have durations between 2 and 7 years, ensuring you don’t have to repay the balance quickly. Many lower-quality lenders will push you to accept financing that’s 6 to 12 months long. This puts a lot of pressure on your business.
Does the Loan Require a Down Payment?
Many lenders, especially more risk-averse ones like larger banks, won’t fund the entire purchase. They’ll often require you to pay for around 20% to 40% of the equipment’s cost upfront.
This is a problem because, if you cannot repay the loan, the lender can claim and liquidate the equipment, and there’s a high likelihood you will lose your down payment.
Instead, choose an offer where the lender can finance 100% of the equipment’s cost, lowering risk on your end.
When you apply with Redline Capital, you receive multiple offers, with all of them financing 100% of the equipment’s purchase price. You don’t need to put money down out of your own pocket.
When Will You Receive the Loan?
Verify the expected funding timeline with the lender, especially when you need to purchase new equipment urgently to keep your healthcare practice operational.
Redline Capital consistently closes loans on the same day that borrowers apply, on some occasions, within four hours of a borrower submitting an application form.
With most other lenders, you can expect a funding timeframe of up to three months, due to all the paperwork the lender needs to underwrite, so it’s impractical if you need funds quickly.
Are There Fixed or Flexible Payments?
Consider whether a lender’s offer is rigid or tailored to your cash flow cycles and seasonality.
For example, we had healthcare providers who start the year slowly but generate more revenue toward the end. So, we offered them terms where they make minimum, interest-only payments during the slow months and larger installments from September to December.
Essentially, we can customize financing terms around your equipment needs, regardless of what they are. Most other private lenders and their SBA loans (Small Business Administration) don’t offer this flexibility.
How Professional is the Lender?
Read online reviews to see how professional a lender is because we’ve heard stories from countless borrowers about how unprofessional some lenders can be by constantly calling and emailing them to accept offers.
At Redline Capital, we conduct ourselves professionally and will never put borrowers under any pressure to accept. When you apply, we show you the offers you qualify for and let you decide whether to accept or walk away.
See what business owners think of our revenue-based financing solutions:
Check out our case studies page to hear some of our borrowers’ experiences:
3 Main Types of Healthcare Equipment Loans
The main types of medical equipment loans are working capital loans, term loans, and lines of credit. The option that’s best for you will depend on the price of the equipment you’re buying and your business financing needs:
- Working capital loans: As the name suggests, these are short-term loans that supplement your working capital when it’s tied up elsewhere or while you’re waiting for revenue to come in. Businesses typically use working capital loans to finance medical equipment that’s less expensive, such as surgical equipment, basic imaging devices, or exam tables.
- Term loans: These are longer-term business loans for purchasing high-ticket medical devices needed for improving patient care. These may include X-ray machines, MRI scanners, and ventilators. Term loans typically range from 2 to 10 years and are much larger in size than working capital loans.
- Lines of credit: These are revolving loans that allow you to withdraw the amount you need for medical equipment and only pay interest on the withdrawn amount, not the entire credit limit. As you repay the loan, you can use it again. Like a credit card, one approval can essentially give you access to multiple rounds of financing.
Secure 100% Project Financing with Redline Capital
Complete this short form and upload four months of bank statements, and we’ll send you several offers with the option to close on the same day.
Frequently Asked Questions
What are the best financing options for purchasing medical equipment?
Revenue-based financing is one of the most practical loan options for purchasing medical equipment because it considers your revenue, rather than all the other criteria traditional banks assess, such as collateral, profitability, tax returns, credit score, and cash reserves. This makes it significantly easier to qualify because all you need to do is meet the lender’s minimum revenue requirement. With Redline Capital, that figure is $30,000 per month.
What credit score do you need for an equipment loan?
To secure a medical equipment loan, most lenders, including large banks, look for a credit score of at least 720, sometimes 750, as this shows them the borrower has consistently made timely payments on their previous loans. At Redline Capital, we only require a business credit of 600, allowing small businesses with less-than-perfect credit histories to qualify.
How hard is it to get a loan for equipment?
Qualifying for an equipment loan can be challenging. That’s because most lenders are risk-averse and don’t want to lend to small businesses in less-than-perfect condition. They often require collateral, cash reserves, large profit margins, explosive growth, and more. However, when you apply with Redline Capital, our main requirement is $30,000 monthly revenue; we don’t review all the factors other lenders do. This makes it easier to secure an equipment loan.
How fast can I get a loan for my medical practice?
Applying with a revenue-based financing provider like Redline Capital lets you close on the same day of applying. That’s because our main requirement is your monthly revenue. As a result, we only need four months of bank statements and can complete underwriting in an hour or two. Most lenders require piles of paperwork (e.g., balance sheets, collateral, tax returns) and spend weeks underwriting, making it difficult to close quickly.