Equipment Financing in Texas
Equipment financing covers any commercial loan or lease used to acquire business equipment — from machinery and vehicles to medical devices and restaurant gear. Texas lenders offer both loans, where the business owns the equipment outright, and leases, where ownership is retained by the lender. Most deals require the equipment itself as collateral.
- Typical deal size: $50,000 to $5,000,000
- Collateral: the equipment being financed (no additional collateral required in most deals)
- Typical term: 24 to 84 months, matched to the equipment's useful life
- Typical time in business: 2 years minimum for most lenders; some accept 1 year with strong revenue
- Down payment: 10–25% typical; some lenders offer 100% financing for creditworthy borrowers
Overview
Equipment financing is a category, not a single product. It covers equipment loans (where the business takes title at signing), equipment leases (where the lender retains title and the business pays monthly use fees), sale-leasebacks (where a business sells equipment it already owns to a lender and leases it back), and equipment lines of credit (revolving facilities used for ongoing equipment acquisition).
The structure that makes sense for a given business depends on three things: how long the equipment will be used, whether ownership matters for tax treatment, and what the balance sheet can support.
In Texas, equipment financing is available from national banks, regional banks headquartered in Dallas and Houston, non-bank equipment finance companies, and specialized lessors. The lender categories serve different deal sizes. Banks generally require stronger credit profiles and longer time-in-business but offer lower rates. Non-bank lenders move faster and accept earlier-stage businesses but at higher cost.
For deals under $500,000, the market is competitive across all five lender types. Above $1,000,000, equipment finance companies and lessors dominate the non-bank market. Above $5,000,000, institutional lenders and structured credit are more common.
One feature specific to Texas: the oil and gas equipment market creates a pool of specialized lessors who are not well represented in national lender databases. If the equipment is field-specific — wellhead components, pumping units, surface separation equipment — a Texas-based lessor will often offer better terms than a national lender applying generic equipment criteria.
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Frequently Asked Questions
What equipment qualifies for equipment financing in Texas?
Most tangible, depreciable business equipment qualifies: vehicles, machinery, manufacturing equipment, medical devices, restaurant equipment, and technology. Lenders exclude general operating supplies, inventory, and real estate. Some will finance software if bundled with hardware.
Is a down payment required?
Most lenders require 10–20% down, but some offer 100% financing for established businesses. The requirement depends on the equipment type, its resale value, and the borrower's credit profile.
How does a lease differ from a loan in equipment financing?
A loan gives the business ownership at signing. A lease gives the lender ownership; the business pays to use the equipment. Leases typically require less capital upfront and may offer tax advantages, but the business does not build equity in the asset.
What is a sale-leaseback?
A sale-leaseback is a transaction where a business sells equipment it already owns to a lender and then leases it back. The business gets immediate liquidity while retaining use of the equipment.
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Page last updated: August 2026