When financing major business equipment purchases, choosing the right lender from the many out there can boggle the mind. Shady companies and scam artists have flourished in the age of the internet, and sometimes, it can seem hard to tell who’s legitimate and who isn’t.
One of the easiest ways to ensure that you select a trustworthy lender is by looking at professional associations like the American Association of Commercial Finance Brokers (AACFB). These groups have high legal and ethical standards for their members, and they can often provide guidance on specific companies for financing equipment in your industry.
If you plan to make a major purchase, then you will want to deal with business-minded lenders who you can trust. Choosing a lender that is a member of a professional association is an excellent way to ensure that your equipment financing is in good hands.
Why Associations Matter
Associations have high standards for their members to ensure that they are reputable lenders. To join these groups, a lender must pass a variety of tests and background checks proving they are legitimate. Members must also often undergo periodic reviews, and they can be expelled from the organization if they are found to engage in unprofessional or unethical conduct.
Additionally, most associations have strict ethical standards that members must follow to maintain their affiliation. AACFB’s code of ethics mandates that its members are honest and professional in their dealings and are fully transparent with clients and relevant organizations.
What Risks Do Non-Affiliated Lenders Pose?
Non-affiliated lenders pose several risks to any company that uses them. Many of these companies engage in predatory practices, such as charging excessively high interest rates or fees. They also may use pressure sales tactics to lure consumers into accepting less-than-ideal loan terms.
LEARN MORE: 3 Non-Negotiables When Selecting Your Equipment Lease Financing Partner
Financing scams unfortunately are prevalent in the age of the internet. Many fraudsters will build legitimate-looking websites to attract consumers, and they will then attempt to steal your information or money. Typically, they target small businesses with limited credit, offering deals that seem too good to be true. Many of these fake lenders will claim to be affiliated with an organization, so you should take time to verify the validity of the organization and their membership before working with them. Associations keep a list of members on their websites for verification purposes.
Choosing the Right Lender for You
While choosing the best lender for your needs depends on many factors, you should always use a company with official affiliations to legitimate organizations. These lenders must meet strict professional and ethical standards to remain in their associations, making them substantially more trustworthy than non-affiliated ones.
You should also take care to select a lender with expertise in the type of equipment that you plan to finance. Associations can also help you in this regard by providing directories of reputable firms in your field.
Global Financial & Leasing Services is a member of the American Association of Commercial Finance Brokers. We specialize in financing for equipment used in health/medical, construction, restaurant, machinery/manufacturing, printing and logging/forestry. We work with business owners who have less-than-perfect credit.
LEARN MORE: What Type of Equipment Qualifies as “Essential Business Equipment?”
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