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First of all, let’s look at…

What are Soft Costs?

Many times on this blog, we discuss the main costs of acquiring equipment, which almost always ends up being the cost of the equipment itself. Pretty straight forward, huh? That doesn’t mean that’s all there is to equipment lending. Often times there are other costs involved, which we like to call “soft costs”. So, what are soft costs exactly? Soft costs can be a range of things, from the cost of delivery, to installation costs, warranties, and even assembly in some cases. You may be asking, “well, why does that matter to me?” These soft costs can affect your business in a big way.

Soft Costs can Offset the Benefits of Financing Your Equipment

Presumably, you’re looking to finance your equipment to ease the burden an equipment acquisition can have on your cash flow. You make easy monthly payments on revenue-producing equipment, and it seems like the equipment is paying for itself with the extra work you’re able to complete with your new gear. But, look at some of the “soft costs” we mentioned above. Deliveries have to happen before you can put your machine to work. Installation, same thing. Many of these costs occur before you even get a chance to see the benefits of your equipment, and can ironically put a pretty big strain on your cash flow when that’s exactly what you were trying to avoid in the first place!

Why Does SLS Finance Soft Costs, and How Does It Work?

We understand the issues soft costs can bring to a business, and we think of these costs as part of the process. We want to make commercial lending as easy and beneficial as possible, and so we understand the power of including soft costs in your payment structure. That being said, just as we look at rates on a sliding scale according to the credit composite of the applicant, we look at soft costs the same way. With a higher credit composite, we may be able to cover more soft costs for your equipment acquisition. Each situation is different and we would welcome a conversation at any time to see what structure would work best for your unique situation. It’s another way we look to make commercial lending… Uncomplicated.

Brian Soetaert


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