Equipment financing can help restaurants purchase equipment (e.g., commercial ovens, refrigerators, fryers, freezers, coolers, dishwashers) without the upfront costs. That way, you don’t have to drain your working capital or wait until you’ve saved enough. You receive a lump sum that covers the equipment purchase and repay it over time.
Having access to fast capital to replace or repair equipment on short notice is often the difference between staying operational and losing days of revenue.
That said, not all restaurant equipment financing options are the same. Choosing the right lender can mean the difference between securing funds quickly with minimal paperwork and waiting months for funding, which can hurt your restaurant’s operations.
To filter out slow, low-quality equipment lenders, our advice is to evaluate them against these three criteria:
- Do they pay the loan into your account, or directly to the seller? Lenders that pay sellers directly limit your ability to shop around and negotiate the best price (we cover this problem in more detail below). Opt for a lender that pays the funds into your account.
- What are their requirements? Many lenders impose steep requirements that most restaurants can’t meet (e.g., near-perfect credit, 5+ years in business, strong profit margins, low debt-to-income). Look for a lender with common-sense eligibility criteria.
- How much paperwork do they require? Paperwork volume is the most reliable predictor of funding speed. The more documentation a lender requires, the longer it takes to fund. Choose a lender with minimal paperwork requirements.
In this article, we cover Redline Capital’s restaurant equipment financing options and how we address each of the three factors above.
Use our automated pricer to calculate how much your business can borrow and what rates you qualify for.
| 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 |
Restaurant Equipment Financing with Redline Capital: Same-Day Funding, Minimal Paperwork
We founded Redline Capital to help restaurant owners access fast capital to purchase, replace, or upgrade equipment. The majority of restaurants that apply with us get funded the same day they apply.
Here’s how we perform against the three criteria above.
Factor #1: We Deposit the Loan Directly Into Your Bank Account
Most lenders don’t deposit loan proceeds into your bank account; instead, they pay the seller directly. This creates three problems.
- You can only buy from the lender’s pre-approved list of sellers. You can’t buy from individual sellers, second-hand marketplaces, or other restaurant owners looking to offload used equipment. This locks you into whatever approved vendors charge and limits your ability to shop around, compare prices, or take advantage of discounts.
- You lose negotiating leverage because the seller knows the payment is coming directly from a lender and that you’re already approved for a specific amount.
- Sellers generally prefer buyers who have cash in hand over those tied to financing approvals. This can cause you to lose good deals to cash buyers.
- You have to submit a new application for every equipment purchase. For example, if you want to buy a new grill, mixer, ice machine, and walk-in cooler, you would need to submit four separate applications.
At Redline Capital, we deposit the loan directly into your business bank account. That means you can purchase from any seller and negotiate freely without your financing arrangement getting in the way. You can also purchase multiple pieces of equipment with the same loan.
Factor #2: Our Requirements Are Easy to Meet — Over 80% of Restaurants That Apply Qualify
Banks and traditional lenders impose requirements that most restaurants can’t meet. Essentially, they expect your restaurant to be in near-perfect financial condition, asking for:
- A credit score of 720 or higher
- 5+ years of operating history
- Strong profit margins
- Low debt-to-income ratios
- Significant cash reserves
- Personal guarantees and down payments
- Multiple years of tax returns and financial statements
On top of this, banks typically view restaurants as high-risk businesses due to their thin profit margins and seasonal revenue fluctuations. So, even restaurants with reasonably strong financials often get rejected.
At Redline Capital, we are a revenue-based financing provider, meaning we approve your application based solely on your gross monthly revenue. We don’t expect your restaurant to be in perfect financial condition to qualify. Here’s all we ask for:
- $30,000 or more in gross monthly revenue
- 12 months or more in business
- U.S.-based location
That’s it. You don’t need perfect credit, years of tax returns, cash reserves, or personal guarantees. This makes qualifying for our equipment financing solutions significantly easier than bank loans.
Over 80% of restaurants that apply with us qualify, compared to the 13% approval rate of banks.
In addition to easier qualification, revenue-based financing allows you to qualify for larger amounts than most banks will extend. Banks rarely lend more than 50% of your monthly revenue because they are so risk-averse. At Redline Capital, we can advance up to 200% of your monthly revenue.
Read more: How Does Revenue-Based Financing Work?
Factor #3: We Only Need 4 Months of Bank Statements and You Can Get Funded the Same Day You Apply
Banks ask for tax returns, profit and loss statements, balance sheets, business plans, and months of financial history before they evaluate an equipment loan. Reviewing all of that paperwork takes a lot of time, which is why most banks only fund after 60 to 90 days.
For restaurants that need to act fast — maybe they need to replace a broken piece of commercial kitchen equipment or take advantage of a time-sensitive deal — a three-month wait simply isn’t an option.
At Redline Capital, we can fund business loans on the same day you apply.
That’s because the only paperwork we need is four months of bank statements showing your restaurant generates at least $30,000 per month in gross revenue. Because the paperwork is minimal, we can complete underwriting within one or two hours.
For example, one restaurant owner’s oven failed on a Friday morning, and we funded them the same afternoon.
Here’s what our application process looks like:
- Calculate how much your business can qualify for and enter your full name and contact information.
- We ask you to submit a four-month bank statement. We review your revenue and run a soft credit check. Rest assured that bad credit is not a dealbreaker as we mainly use it to determine the rates you qualify for, not whether you’re approved.
- We email you multiple financing offers within one or two hours. Each offer clearly details the financing amount, what you’ll repay in total, the factor rate, and how payments are structured.
- You choose the offer that fits your restaurant. Take as much time as you need. There is no pressure and no expiration date.
- The lump sum is transferred via wire or ACH into your account within one or two hours after you accept an offer, and you use it to purchase commercial kitchen equipment. From the moment you submit your bank statements to the moment funds hit your account, the whole process takes under 24 hours. In urgent situations, we’ve funded restaurants in just four hours.
Read more: How to Apply for Revenue-Based Financing
Additional Benefits of Partnering with Redline Capital
We Help You Secure Lower Rates Than Other Lenders
Many restaurant owners think that going directly to a lender is the best way to secure competitive rates. But working with an experienced broker like Redline Capital often gets you access to better offers than you could secure on your own.
Over the past decade, we’ve delivered millions of dollars’ worth of high-quality applications to our lending partners, including OnDeck, Rapid Finance, and Headway Capital. That volume helps them grow their lending business. In return, they extend our clients wholesale rates, discounts, higher credit limits, and more flexible terms that aren’t available to direct applicants.
Basically, when you apply through Redline Capital, you draw on the relationships we’ve built with lenders over the past decade to get offers that wouldn’t otherwise be on the table.
In addition to lower rates, working with us comes with two smaller but meaningful advantages:
- Funding in hours when it can’t wait until the end of the day: Our strong relationships with specific loan officers mean we can call them directly, bypassing lengthy applications. As a result, we’ve been able to provide restaurants with emergency funding in under four hours.
- One application, multiple offers: Rather than applying separately to multiple lenders, you only have to submit one application and receive competing offers, giving you a clear picture of what’s available.
Read more: Why Use Revenue-Based Financing Instead of Debt Financing?
We Have Deep Experience Working with Restaurants
We’ve worked with restaurant owners across fast casual, fine dining, food trucks, catering operations, and commercial kitchens. We understand the financial realities of running a restaurant: the thin margins, the seasonal swings, and cash flow pressures.
Many revenue-based financing lenders without experience working with restaurants view these characteristics as red flags and charge higher rates as a result.
At Redline Capital, we recognize them as the normal conditions of the restaurant industry, not signs of a struggling business. We won’t penalize you for being in a seasonal low, having thin margins, or carrying debt.
We can also structure repayment terms to align with your restaurant’s cash flow cycles. If your revenue dips in January and February but picks up in the summer and around the holidays, we can tailor your payment schedule to reflect that. You can make smaller installments during slow periods and larger ones during stronger revenue periods. Most lenders don’t offer this repayment flexibility.
We Never Pressure You to Accept Our Offers
A clear warning sign of a low-quality lender is pressure. The moment you apply, some lenders bombard you with calls and emails and manufacture false urgency with expiring offers. This is a tell-tale sign that their offers aren’t competitive and that they don’t want you shopping around.
At Redline Capital, we send you the offers you qualify for and step back. We don’t bombard you with follow-up calls and emails.
We’re confident enough in our rates and payment terms that we encourage you to shop around and compare. We’d rather you come back to us knowing you looked at every option than accept our offer without doing your homework.
Here’s what business owners say about our equipment financing:
Our case studies page features restaurant owners talking about their experience with Redline Capital:
Apply for Equipment and Food Service Financing with Redline Capital
Use our business lending pricer to generate instant quotes and see what loan amounts and rates your restaurant qualifies for.
Alternative Types of Restaurant Equipment Financing
We believe revenue-based financing is the best option for most restaurants, as it ticks all three boxes above better than other financing options.
However, we want you to understand and compare all your options. So, we also cover other common types of restaurant equipment financing and how they hold up against the 3 requirements.
Traditional Bank Loans
Traditional bank loans offer some of the most competitive interest rates among financing options available to restaurant owners, and their longer repayment terms keep monthly payments down. If you qualify, they’re one of the most cost-effective ways to finance equipment.
However, banks typically pay sellers directly rather than depositing funds into your account, which limits your ability to shop around and negotiate freely. You can only purchase new equipment from one of the bank’s approved sellers.
Their qualification requirements are among the most demanding in business lending. Most banks want excellent credit, several years of profitable operating history, collateral, personal down payments, and extensive financial documentation. Beyond that, banks view restaurants as inherently higher risk, and we’ve seen restaurants with strong financials get rejected.
And because banks have to underwrite mountains of documentation, the approval and funding process takes 60 to 90 days.
SBA (Small Business Administration) Loans
SBA loans are government-backed business loans issued through banks and approved lenders.
Because the government guarantees a portion of the loan, lenders can offer lower interest rates and longer repayment terms. This makes SBA loans even more affordable than regular bank loans.
That said, SBA loans are among the most demanding financing solutions available.
Like bank loans, SBA lenders don’t deposit funds directly into your account, and the eligibility requirements are even stricter than standard bank lending.
The process also involves both the lender’s underwriting and a government review layer, which can delay funding.
All in all, SBA loans are a strong option for established businesses with the financial profile to qualify and no urgent need for funding, but they are a poor fit for anything time-sensitive.
Restaurant Equipment Leasing
Restaurant equipment leasing is worth considering if you’d rather preserve cash flow than take on debt.
Because you’re not purchasing the equipment outright, leasing keeps the cost off your balance sheet and allows you to upgrade to newer equipment at the end of the term. This can be a real advantage if you’re buying technology-driven equipment that becomes outdated quickly.
But restaurant equipment leasing also comes with disadvantages worth considering.
Requirements vary depending on the finance company, but are generally faster and more accessible than bank loans, and paperwork is relatively straightforward. The main limitation is that leasing companies pay vendors directly, which limits your ability to shop around, source equipment independently, or negotiate prices.
Over the full term, you may also make more lease payments than the equipment’s outright purchase price, and you don’t build any equity in the equipment itself.
Merchant Cash Advances
Merchant cash advances (MCAs) are among the fastest and most accessible financing options. MCA providers deposit funds directly into your account, and they don’t have excessive requirements like banks. This makes them a strong option for startup restaurants or those with less-than-perfect credit.
Merchant cash advances also ask for very little paperwork, so same-day or next-day funding is possible in most cases.
Where merchant cash advances fall short is cost. Factor rates tend to be higher than other financing options, meaning the total repayment amount can be significant relative to what you borrow. They perform well against the three criteria above from an access standpoint, but the cost makes them better suited to urgent, short-term needs.
Revenue-based financing through Redline Capital gives you the same speed, ease of qualification, and flexibility as a merchant cash advance, but at a significantly lower cost.
Again, that’s because of our relationships with lenders, which enable us to secure preferential rates that aren’t available to direct applicants or through most other brokers.