Many companies across nearly every industry require equipment or machinery to conduct business. Needed pieces include everything from manufacturing equipment to commercial vehicles to restaurant, medical, and office equipment.
The one thing that most equipment has in common is a hefty price tag. Equipment financing is one of the most needed forms of small business loans since so few companies have the cash reserves to purchase these pieces outright.
Lenders like Taycor Financial offer various equipment leasing and financing options. It also provides a variety of business loans to help you meet working capital needs.
However, before pursuing an equipment or working capital loan, you should know the risks and costs. This review covers how the company works, your available options, and benefits and drawbacks to the lender, including costs.
Specifically, we’ll answer these questions and more:
Taycor Financial is a small business lender specializing in equipment loans, leases, and working capital lending products. The company has offices in California and Boston, but you can apply online from anywhere.
Borrowers benefit from large borrowing amounts and lightning-fast funding times. Although its working capital loan rates are high, it offers reasonable rates on its equipment financing products. The company has been active since 1997.
The lender provides several financing options for used or new equipment, including loans and leases. All the lender’s equipment loan and leasing programs options carry a documentation fee, but the fee range is undisclosed.
You can get funding for the following:
Here are the details for each product.
It’s possible to finance 100% of the total amount on equipment loans through the lender, meaning you don’t have to make a down payment. Taycor will email, overnight, or hand deliver the documents. Once it receives the documents, it immediately faxes the purchase order to the vendor. You’ll build equity in the equipment as you pay off the loan.
The equipment leasing option offers the same ranges and terms as its equipment loan, but you don’t own the equipment at the end of the term. Instead, it provides a few different end-of-lease options.
Fair Market Value (FMV). This option is best if you think the equipment will rapidly lose value or become obsolete by the end of the leasing term. When the term ends, you can either return the equipment, extend the leasing term, or purchase the equipment at fair market value.
$1 Buyout. This option is best if you believe the equipment will retain value or have a long lifetime of use. When the term ends, you purchase the equipment for $1 (or $101, depending on the tax laws in your state).
10% Purchase Option. This option allows you to return the equipment or purchase it for 10% of the cost at the end of the term. It allows you to own or retain the equipment while keeping the purchase cost low.
It’s possible to refinance larger equipment loans with Taycor as well. The terms are shorter, and interest rates start higher.
You’ll likely have to pay documentation and origination fees. The repayment schedule would be the same as any loan term.
This method allows you to lease the equipment back after selling it for a cash infusion.
In addition to its equipment options, the lender offers several working capital options.
Here are the details for the company’s working capital products.
A term loan is what most people think of when they hear “business loan.” You get a large sum of money upfront and repay it, plus interest and fees. You can use the funds for various business purposes.
A line of credit acts like a credit card. You get a credit limit and draw funds from it as needed. You only pay back what you draw, plus interest and fees. Lines of credit are good for seasonal businesses, ongoing projects, and covering unexpected expenses.
The lender’s website also markets Bridge Loans and general Business Loans but doesn’t not specific details on them. Some reviews suggest the lender might also provide the following:
However, we do not have any details on these programs. Several online reviews suggest the lender provides SBA 7(a) and SBA Express loans, but the company’s website does not list any SBA loan options.
The qualifications change depending on the product. Here are the eligibility requirements by product type.
Equipment Financing
Equipment loan applicants should meet the following minimums:
Business Term Loans
You should meet the following minimums to qualify for a term loan:
Business line of credit:
Qualifications for other loans are unlisted.
Its rates for equipment loans are competitive, but the costs for other small business funding options can get quite expensive. The lender uses factor rates for term loans and lines of credit.
Factor rates are more expensive but easier to calculate. The same costs of funds apply regardless of how quickly you repay.
For example, if you borrowed $100,000 at a factor rate of 1.2, you’d multiply the principal by the factor rate:
$100,000 x 1.2 = $120,000
You’d pay $20,000 in interest to borrow $100k.
Most of the lender’s products carry fees. All equipment financing options have documentation fees. While it finances 100% of equipment costs, leasing customers must pay the first and last month’s payments.
Term loans have an origination fee of 0% – 5%. Line of credit origination fees are between 0%-3%.
While the company offers other financing options, its primary focus is equipment financing. It’s one of the leading options available.
The lender’s website does not provide information for business loan brokers or business loan referral programs. However, several online reviews from the lender’s customers mentioned working with a broker. You may need to contact them directly to see the available referral options.
The application process is simple and straightforward. There are minimal documentation requirements for transactions up to $400,000.
Follow these steps to apply.
When filling out the application, you’ll select if you want equipment financing, working capital, or both. You’ll then enter how much you want to borrow, how you’ll use the funds, and your timeframe. Next, you’ll enter information about your company and yourself.
The lender offers a concierge approach. You will work with a finance professional to choose the appropriate funding program. Transactions over $400,000 or complex financing structures will require more detailed documentation, including:
Existing and well-qualified customers can apply with a low documentation application.
The lender uses electronic documents that you can sign to finalize the loan. Once you sign and return the required documents, the lender can fund loans within 24 hours.
Repayments begin after receiving your funds or equipment. Each product has different payment options.
You can repay equipment loans monthly, seasonally, quarterly, or semi-annually. Equipment leases have fixed monthly payments for the term.
Term loans carry daily, weekly, or monthly payments. Lines of credit payments are either daily or weekly.
The website’s FAQ states that you can pay off an equipment lease early but does not indicate if there are any early payment discounts for any of its products. It also doesn’t publish information on renewals, but we know from user reviews that customers have renewed with them.
The primary benefits of Taycor are the easy application and lightning-fast funding time. It also offers a variety of lending products, including multiple equipment financing options.
The lender can fund up to 100% of the equipment costs, meaning you don’t have to make a down payment. The financing costs for equipment are competitive with similar lenders.
You can also borrow a large amount, which is helpful for equipment and vehicle purchases. These pieces of equipment can carry very large price tags.
It also offers lower qualifications, including low credit score minimums. The lender also provides combination financing if you need to acquire equipment and working capital.
The lender’s factor rates on working capital products can be expensive. It also charges a documentation fee on equipment financing and origination fees on working capital. Those increased costs can add up.
It isn’t easy to get concrete information from the lender’s website. It provides a lot of detail on its equipment financing products, including a helpful FAQ, but doesn’t list much regarding borrowing amounts, rates, and fees.
The information it provides on working capital products is even more minimal. The lack of information makes it difficult to determine and compare costs to other lending institutions.
Here’s a summary of the benefits and drawbacks of the company.
Pros:
Cons:
Yes, Taycor Financial is a legitimate lending institution. It’s been around since 1997, and the Better Business Bureau (BBB) has accredited the company since 2001. It has an A+ rating on the watchdog site. Being based out of California, it is also a CA Licensed Finance Lender.
Despite being in operation for over 25 years, the lender has very few online reviews. It has no reviews on BBB but closed seven complaints in the last three years.
The lender only has eight reviews on Trustpilot, with an average of 2.3 out of 5, which is considered poor. Its reputation is much better on Google Reviews, with a 4.7 out of 5 rating on 203 reviews.
Positive reviews talk about the excellent customer service, with several users calling out their representative by name. Another common theme is that the lender helped customers secure funding when they didn’t think they’d be eligible. Several customers commented how the equipment financing helped them increase revenue.
The negative reviews largely talk about the costs. Several customers complained that the amount they were charged differed from what they were quoted. Some users said they had trouble getting in touch with customer service or were treated poorly, but the positive mentions of the service team far outnumber the negative ones.
There are several reasons Taycor might deny a financing application. You might not qualify due to a low credit score, lack of time in business, or not having high enough annual revenue.
Other reasons for a loan denial could be related to cash flow, issues in your credit history, or being in a high-risk industry. If you were denied a loan, the denial letter should explain why. If not, you can call the lender directly for more information.
Fortunately, there are many lenders to consider if Taycor doesn’t work for you. Several provide excellent equipment financing options and working capital loans. If you’re trying to get financing with a low credit score, many bad credit business loan options exist.
You shouldn’t have much trouble finding a business term loan or business line of credit at another lender. Other options for working capital include:
Taycor is best suited for small businesses that need fast funding to acquire equipment. It’s also a good option for low-credit borrowers who need to package equipment financing with a working capital loan.
Established companies with good to excellent credit scores could probably find lower-cost working capital at a traditional lender, like a bank or credit union. However, the fast funding time would still make the lender an attractive option if you need the funds quickly.
The lender’s equipment financing interest rates are competitive, and you get flexible repayment options. Its various end-of-term options also provide greater flexibility than some equipment leasing programs. The increased fees are a drawback, however.
Based on user reviews, available products, and costs, we rate Taycor Financial at a 4 out of 5. The available lending products are impressive, but the fees and lack of transparency hold them back from a higher score.
Disclaimer: The Taycor Financial trademark is owned by TF Group, Inc. DBA Taycor Financial and its use herein is for reference purposes only and it does not indicate sponsorship or endorsement from TF Group, Inc. DBA Taycor Financial.
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