Equipment financing continues to be one of the most accessible forms of business credit, with 76% of applicants receiving full or partial approval, according to the 2024 Small Business Credit Survey published in March 2025.
The 2025 report shows that automobile and equipment loans remain strong in approval rates compared to other funding options, with 73% of the approval rate being fully approved and an additional 18% being partially approved.
Despite favourable approval odds, documentation requirements for equipment financing are substantial and may vary widely depending on the type of lender, loan structure, and equipment category. Traditional banks usually require a wide range of document packages, but online lenders often streamline their requirements to facilitate processing.
Understanding the required documents before applying can help you greatly improve your approval potential and ensure better terms. This comprehensive breakdown covers essential documents that are generally necessary when applying for equipment financing.
Business Plan
Business Plans talk a lot about your strategies for how you grow and increase profitability. Some lenders need a business plan to learn more about their business, their operations, overall market conditions, and financial forecasts. Details to include in your business plan include:
- Important Purpose
- Target market
- Product and Service Description
- Marketing Strategy
- Market research on competitors and target customers
- Mission Statement
- Current financial situation
- Financial forecasts with disruptive points
Financial Statements
Lenders request multiple financial documents to verify the financial health of the entire business. They use these statements to predict whether your business has the ability to pay off the loan and determine the amount of loan you qualify for.
Keep these financial documents handy when applying them.
- Bank Statement of Cash Flow Photos
- Balance sheet showing assets and liabilities
- Income and Loss Statement
- Revenue forecast
- Personal and Business Income Tax Statement for the Last Three Years
- Personal and business credit history
Purchase or Franchise Agreement
Second, if you purchase a business from another individual, you will also need a business purchase agreement. A business purchase agreement contains information about the buyer, seller, equipment or assets that have been purchased.
Also, if it is important to know whether the previous owner still retains ownership or employment, it outlines the liability that buyers and sellers have to the business after sale.
Similarly, if your business is a franchise, you must provide a franchise agreement that grants you the right to operate under the franchise brand.
Accounts receivable and accounts payable
In addition to the other financial statements required for an equipment loan, the lender also needs an income statement that shows the revenue and expenses of your business. Looking at all your accounts receivable and accounting paid will help lenders understand your current financial position.
Equipment specifications and quotations
When applying for financing for your equipment, you will need to provide details about what you plan to purchase. This usually includes manufacturer specifications, model numbers, serial numbers (for used equipment), and official quotes from vendors. For significant purchases, many lenders request estimates from multiple vendors to ensure they have a fair market value.
For used equipment, expect to provide additional documentation such as maintenance records, operation history, and current condition reports. These details help lenders assess the remaining useful life and potential resale value of the equipment. This is an important factor in determining the terms of your loan.
evaluation
Depending on the type of equipment and the amount of equipment purchased, lenders may want to be assessed to determine the true value of commercial equipment. Lenders are more likely to require this document for used equipment as the assessment takes into account current wear of the equipment.
Legal Documents
Finally, lenders who provide equipment loans should ensure that they comply with registration and licensing requirements to ensure that your business is legally running. Documents you may need to provide:
- Business entity documents such as articles of association
- Business License
- Commercial leases, if applicable
- Contracts with third parties
- Employer Identification Number (EIN)
SBA Loan Document
If you are pursuing equipment financing through an SBA loan program, such as the 7(a) program, additional documentation will be required. SBA offers several loan types with different requirements, all typically require at least an SBA Form 1919 (the borrower information form). SBA loans generally have more stringent document requirements, but offer competitive conditions and a higher guarantee rate. Through the 7(a) small loan program, up to 85% for loans under $150,000 and 75% for bulk loans.
Debt Schedule
Lenders are increasingly concerned about the company’s existing debt levels. The 2025 Federal Reserve Small Business Credit Survey found that companies were refusing to raise funds was very likely to cite “already many debts” as a reason for their refusal (only 22% in 2021). Providing a comprehensive debt schedule detailing all outstanding loans, monthly payments, interest rates and remaining terms will provide transparency and help lenders assess their ability to pay off.
Conclusion
Equipment Loan applications require considerable documentation to prove your business’s financial health, legal status, and ability to handle loan payments. Although certain requirements vary by lender, most require financial statements, business documents, and detailed equipment information.
The funding environment continues to evolve, with the 2025 Federal Reserve Report showing that 59% of small businesses in 2024 were seeking funding, and 41% received all the funds they requested. However, 24% of applicants have not received any of the funding they were sought, and thus emphasize the importance of thorough preparation.
Online lenders typically have more streamlined document requirements than traditional banks, but may charge higher interest rates. Small banks continue to offer the highest full approval rate at 54% compared to 30% of online lenders.
Please contact your potential lender to check the exact document requirements before applying. If prepared properly, it can have a major impact on both your approval chance and the conditions you receive.
