Heavy Equipment Financing Simplified
Paradigm Equipment Finance provides up-front, easy-to-understand guidance for businesses seeking equipment financing. We serve businesses throughout the United States as an alternative lender, providing construction equipment financing to subprime borrowers who have solid business fundamentals and a comprehensive understanding of the assets they’re pursuing.
Below is a review of our equipment financing guidelines. Please keep in mind that Paradigm Equipment Finance is a collateral-based lender, and that all decisions are based on our evaluation of the type and value of the equipment being leased.
Deal And Credit Analysis
Before moving forward with any heavy equipment finance, we require that our clients provide the following information for credit analysis:
Application for lease
Authorization to pull credit
Minimum three months of bank statements
Equipment list of pledged collateral
Invoice or proposal for equipment to be purchased
Corporate and personal financial statements and tax returns for deals over $150,000
Credit Guidelines
As an asset-based lender, we strive to accommodate lessees regardless of traditional creditworthiness metrics. Below is a matrix of guidelines to be used in determining pricing and collateral requirements:
*Based on monthly lease payment. Approval will be subject to an analysis of a minimum of three monthly bank statements.
Tier
I
II
III
IV
Grade
A
B
C
D
Credit
Deposit Requirement/Extra Equipment
*Average Ending Balance
1:1:1
1:2:1
1:5:1
2:1
20% Cash / 1.5:1
33% Cash / 1.75:1
50% Cash / 2:1
15x Pmt
20x Pmt
15x Pmt
20x Pmt
6x Pmt
4x Pmt
4x Pmt
2x Pmt
Credit
Ratio
10% Cash / 1.25:1
*Average Monthly Deposit Required
700+
660-699
620-659
580-619
Tier
IV
Grade
D
Credit
580-619
Avg Ending Balance
Deposit Req/Extra Equip
2:1
50% Cash/2:1
12x Pmt
2x Pmt
Avg Monthly Deposit
Cover Ratio
Tier
I
Grade
A
Credit
700+
Cover Ratio
Deposit Req/Extra Equip
1.1:1
10% Cash/1.25:1
20x Pmt
6x Pmt
Avg Monthly Deposit
Avg Ending Balance
Tier
II
Grade
B
Credit
660-699
Cover Ratio
Deposit Req/Extra Equip
1.2:1
20% Cash/1.50:1
15x Pmt
4x Pmt
Avg Monthly Deposit
Avg Ending Balance
Tier
III
Grade
C
Credit
620-659
Cover Ratio
Deposit Req/Extra Equip
1.5:1
33% Cash/1.75:1
15x Pmt
4x Pmt
Avg Monthly Deposit
Avg Ending Balance
Deposit and collateral requirements are subject to minimum coverage ratios. More conservative requirements are taken when using equipment in place of cash deposits. Set pricing is also subject to meeting all minimum Tier requirements. For example, if a lessee has a 700+ credit score but average monthly deposits of 16x the new monthly lease payment, the lessee is scored as Tier II instead of Tier I.
Secure The Assets Your Business Needs
Looking for an asset-based lender who can help your business transcend traditional financing options to get the equipment you need? Let Paradigm Equipment Finance help you the way we’ve helped countless others. Contact us below for more information about our lending process or fill out a quick application here!
Restricted
Restaurant
Technology/IT
Leasehold Improvements
Anything Related To CBD
Equipment Valued Under $10,000
Preferred
Medical
Heavy Construction/Yellow Iron
Titled Trucks & Trailers
Heavy Industrial Equipment
Mining (Surface Equipment)
Manufacturing (Min. Value $10,000+)
Agriculture
Inspection And Valuation
After a proposal receives a conditional approval and receipt of the initial deposit required, Paradigm Equipment Finance will move forward. As part of our due diligence, we complete a thorough evaluation of collateral and a site inspection of the business.
Completed reports include pictures, notes and values of the collateral item(s), as well as pertinent information regarding industry, condition and resale values. The scope of an inspection will vary depending on the nature of the assets and collateral involved.
Equipment And Industries
Each individual piece of equipment being leased requires a valuation in excess of $10,000. Paradigm Equipment Finance retains the rights to make an exception based on a blanket UCC-1 lien on company’s assets. The following is a list of preferred and restricted equipment and industries we deal in.
