How do I finance new restaurant equipment?

Restaurant equipment financing approves borrowers with a 600+ FICO score, at least 6 months operating history, and $15K+ monthly revenue, offering rates of 8‑15% APR with 0‑20% down and terms of 3‑7 years (axiantpartners.com).

Eligibility basics

Equipment financing typically costs 6–22% APR over 2–7 years and most lenders approve applicants with 600+ FICO and 1+ year in business, holding a claim on the asset until it is repaid (baystreetlending.com).

To apply for restaurant equipment financing, lenders typically require the applicant’s personal credit score, time in business, and annual or monthly revenue, plus documentation proving the business is a registered entity such as an LLC or C‑Corp (nav.com).

• Ask the lender to list the credit score, revenue and time‑in‑business thresholds they require.

• Write down the minimum monthly revenue you must show.

• Confirm whether they need your business entity paperwork like LLC formation documents.

Review How Can I Finance Commercial Kitchen Equipment in Akron, Ohio? while preparing questions for the lender.

Cost and terms overview

For restaurant equipment financing, borrowers with excellent credit (720+) see APRs of 6.9‑9.9% over 60‑84 months with 0‑10% down, while challenged credit (below 640) faces 17.9‑24.9% APR over 24‑48 months with 15‑30% down (fundmyequipment.com).

In 2026, restaurant equipment financing rates typically run 8% to 30% APR depending on credit, with loan terms ranging from two to seven years (lendingvalley.com).

Restaurant equipment financing rates run 6‑20% APR, 1‑3% higher than manufacturing or construction financing due to the hospitality sector’s higher business failure rate (fundingcompass.guide).

• Request a rate quote for your credit profile and ask how the APR changes with down payment size.

• Ask the lender for the shortest and longest loan terms they offer and the monthly payment estimate for each.

Review Alexandria, VA – How Can I Finance Commercial Kitchen Equipment? while preparing questions for the lender.

Collateral and ownership

Equipment financing is an asset‑based loan that uses the purchased equipment as collateral, making it easier to qualify for borrowers with bad or fair credit compared to unsecured lines of credit (nerdwallet.com).

A $1 buyout lease lets the lessee own the equipment at the end of the term for a $1 payment, while a standard equipment loan results in immediate ownership (tabcommerce.com).

Equipment loans fund specific kitchen items such as commercial ovens, walk‑in coolers, and reach‑in refrigerators, with the equipment itself securing the loan so no additional collateral is usually required (doordash.com).

• Ask if the equipment itself will serve as the loan collateral and whether any personal guarantee is needed.

Application preparation

Startup restaurants with no operating history can still finance commercial kitchen equipment because the equipment itself serves as collateral, allowing lenders to focus on asset value rather than the company’s financial track record (providecapital.com).

• Make a checklist of personal credit reports, business tax returns, bank statements and purchase quotes.

Additional questions

How does an SBA loan compare for kitchen equipment?

A $50,000 equipment loan at 9% APR over 5 years amortizes to about $1,038 per month, whereas a $50,000 SBA 7(a) loan at 10.5% APR over 10 years costs roughly $675 per month but incurs about $16,000 more total interest (usecalcpro.com).

Disclosures

This content is for educational purposes only and is not financial advice. commercialkitchenfinancing.com may receive compensation from partner lenders, which may influence which products are featured.

Sources

• axiantpartners.com
• baystreetlending.com
• nav.com
• fundmyequipment.com
• lendingvalley.com
• fundingcompass.guide
• nerdwallet.com
• tabcommerce.com
• doordash.com
• providecapital.com
• usecalcpro.com