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Medical Equipment Financing – The Essential Guide

Doctor using medical equipment they got with the help of medical equipment financing

Whether you are a large hospital or small private practice, state-of-art equipment puts you at the cutting edge of patient care. You want to take care of your patients and help your business grow.

Unfortunately, new equipment is expensive – especially in the healthcare industry. Many healthcare providers turn to medical equipment financing when they don’t have the capital to pay the total price upfront.

An equipment loan could help your medical practice get the equipment you need and provide the best for your patients. How can your company benefit from a business loan?

We can help you answer essential questions like:

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    What Are Medical Equipment Loans?

    Equipment financing empowers you to supply your facility with the best products from prominent medical manufacturers. An equipment loan is similar to a standard bank loan, except you can use the equipment as collateral.

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    Loan Collateral

    Using the equipment as collateral helps mitigate the risk for the lender. Lower risk means lenders are more likely to provide financing, often with higher loan amounts and competitive rates. In addition, it can increase your chances of approval.

    Equipment You Can Obtain

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    Here are just a few examples of the medical devices and equipment you can purchase with medical equipment financing:

    • MRI, CT Scans, and other medical imaging equipment
    • Hospital beds and pressure mattresses
    • EKG/EEG machines
    • Pharmacy equipment
    • Patient monitors
    • Defibrillators

    How Do Medical Equipment Financing Programs Work?

    Healthcare equipment financing is similar to other types of loans. Figure out how much you need for the new equipment, find a lending institution, and apply.

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    Equipment Loan Terms

    Medical equipment finance typically includes:

    • Loan amounts up to $5 million per piece of equipment.
    • Loan terms of 1-6 years.
    • Rates start at 3.5%.
    • 3-10 days for funding.

    Once approved, the funds go to the vendor to buy the equipment. You then pay the loan back weekly or monthly, depending on loan terms.

    How Do you Qualify for Medical Equipment Financing?

    One of the advantages of medical or any business equipment financing is using the equipment as collateral, which lowers the threshold needed to get approved.

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    Loan Requirements

    Typically, you will need:

    • A credit score of 600 or better.
    • Minimum of 1 year in business.
    • Annual revenue of $250,000.

    The exact requirements depend on the loan amount and the lender.

    How to Apply for a Medical Equipment Loan:

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    The process of applying is quite fast. You can apply directly through our one-page application in a matter of minutes or reach out to one of our loan experts to guide you through the process.

    Step 1: Make sure the purchase is right for your healthcare facility.

    You will want to compare the invoice price to the market value of the medical equipment. You should also determine if you’ll still need the equipment a few years from now or if it is likely to become outdated. Once you know purchasing is the right option, you can move to the next step.

    Step 2: Gather your documentation.

    When applying for medical equipment financing, you need to provide:

    • Driver’s license.
    • Voided check.
    • Bank statements from the past three months.
    • Invoice for the medical equipment.
    • Financial statements.

    Depending on the loan amount and the lender, you might need to provide additional documentation.

    Step 3: Complete the application.

    Go to our application page or give us a call for more information.

    Step 4: Speak to a representative.

    After we receive your application, a senior account executive will reach out to you. The call will focus on your best medical equipment financing options and fixed-term business loan offers. We offer complete transparency, and there are no hidden fees or surprises.

    You’ll get a complete breakdown of loan amounts, terms, interest rates, and fees. Once you have all the information, you can make an informed decision about your equipment loan.

    Step 5: Get approved.

    Your loan goes through when your application meets underwriting requirements and gets credit approval. Next, funds go to the equipment vendor to pay the invoice amount. The lender then holds the title with your business until the loan is paid off.

    We can help you set up automatic payments, or you can make arrangements to pay by check or electronic payment.

    What are the Alternatives to Medical Equipment Loans?

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    There is no shortage of funding options for medical equipment or other business needs. Here are some other financing options to consider:

    If you aren’t sure what loan type is best for your business, our loan experts can help guide you.

    Are there Medical Equipment Financing Options for Bad Credit?

    Since the medical equipment is used as collateral in the loan, lenders are typically willing to work with borrowers who don’t have great credit. There are additional things you can do to help offset poor credit and still get approved. If you’re having trouble finding a lender, you could try:

    • Making a down payment.
    • Getting a co-signer.
    • Offering additional collateral.

    Is It Better to Lease or Finance Medical Equipment?

    Both medical equipment leasing and medical equipment financing have their own sets of benefits and risks. With a medical equipment loan, you own the equipment outright at the end of the financing term. On the other hand, there’s a chance the equipment could be outdated by the end of the loan term.

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    Medical equipment leasing usually comes with lower monthly payments. If the equipment breaks down, you can replace it, or the leasing company will fix it. However, you don’t own the equipment.

    Medical Equipment Financing Pros and Cons


    • Use the equipment as collateral for better rates.
    • Own the equipment at the end of the term.


    • If the equipment breaks, you have to fix it.
    • Potential depreciation if it becomes outdated.

    Medical Equipment Leasing Pros and Cons:


    • Fixed lease payments.
    • The leasing agency handles repairs.


    • You don’t own the equipment.
    • No way to recoup value from rental payments.

    Ultimately it comes down to your unique business needs. There are other factors to consider, like the lifetime value of the medical equipment, how you can manage the monthly payments and which types of equipment will help you deliver the best outcomes for your patients.

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    Final Thoughts

    If you need new equipment, a loan could help your company, but you need to weigh the benefits and risks. The interest on the loan adds to the total cost, so you have to make sure it’s worth it.

    If you’re still unsure if this loan is right for you, our friendly loan executives can help you decide. Reach out today to review your options.

    We will help you grow your small business.

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        At UCS, we understand the value of your time and want to ensure that your application has a great chance of approval. Please take note of the following details before applying:
        • To be eligible, it’s necessary to have a business bank account with a well-established U.S. bank such as Chase, Wells Fargo, Bank of America, Citibank, or other major banks. Unfortunately, online-based bank accounts like PayPal, Chime, CashApp, etc., are not permitted.
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        We appreciate your understanding and cooperation in ensuring a smooth and successful application process.
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