Compare business loans for HVAC companies | finder.com
HVAC company funded by business loan

Compare business loans for HVAC companies

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Get the newest tubing cutter or expand your business with financing that fits your HVAC company.

HVAC work is highly skilled, and your training has undoubtedly paid off in the form of a fulfilling career. But there’s always room for improvement.

Shifting from contractor to business owner or growing your existing HVAC business can take time and cash to get going. We cover your options, what’s necessary to apply and tips to succeed as a small business among big-name competitors.

LoanBuilder, A PayPal Service Business Loans

Our top pick: LoanBuilder, A PayPal Service

Customizable business loans with no hidden fees.

  • Min. Amount: 5000
  • Max. Amount: 500000
  • One-time fixed fee charged over the life of the loan
  • Acclaimed customer service
  • Requirements: $100,000+ annual revenue, 1+ years in business, 600+ personal credit score

    What loan options should I consider for my HVAC company?

    You could get just about any type of business loan as long as you meet the eligibility requirements. Here are four specific loan types that might be most beneficial for an HVAC company due to their features:

    1. Equipment financing. Expensive equipment, like a new truck to get to your jobs, can potentially act as collateral for the loan you need to purchase it. You can think of equipment financing like a typical car loan: You generally get a better rate when there’s something to minimize the risk that comes with lending money. This one is just specific to the industry equipment you need, instead of a new hatchback for your family.
    2. Invoice factoring. Have accounts receivables? You may be able to sell them at a discount to a third party. The transaction is completed when your client pays their open invoice and the funds go to the party you sold to. Invoice factoring often doesn’t require a credit check, which can be useful if you’re just transferring over from independent contractor to business owner.
    3. Small Business Administration (SBA) loans. Should you qualify as a small business by federal standards, an SBA loan could get you a better rate than a general purpose loan. SBA loans are guaranteed up to a specified amount by the government, which reduces the risk for lenders. Know that while you could potentially borrow a large amount, SBA loans are government issued and move at the same slow pace most other government processes do.
    4. Business lines of credit. If you don’t mind not having the rewards options, a business line of credit can function similarly to a credit card. Generally, the APR offered for a business line of credit is better than that of a credit card, and some come with promotional 0% APR periods too.

    5 factors to look for when comparing loan offers

    When you’re reviewing the different types of loans and lenders, make sure to pay attention to the following:

    • Loan amount. It’s wise to get a loan that isn’t far from the amount that you actually need. Overspending is a big risk when it comes to having more funding than you need, and having less than you need can mean winding up with multiple sources of debt instead of just one.
    • Loan term. A longer term has the benefit of lower monthly payments but can result in a higher cost overall. Be sure to look at more than just what gets you the smallest cost each month.
    • Interest rate. One of the clearest indicators of your overall cost is going to be the interest rate you’re charged. Make sure you carefully weigh it against the other factors presented and request the APR when available.
    • Eligibility. Narrow down your choices easily by looking at what you can actually qualify for. Prequalification standards like time in business and annual revenue can slim down your search.
    • Fees and charges. Not all lenders are forthcoming about all of the charges that can be added to the cost of your financing. Make sure to ask about any additional costs outside of the interest rate.

    Compare business financing options from top providers

    Rates last updated September 21st, 2018
    Unfortunately, none of the business loan providers currently offer loans for these criteria.
    Name Product Product Description Min Loan Amount Max. Loan Amount Requirements
    LoanBuilder, A PayPal Service Business Loans
    Customizable loans with no origination fee for business owners in a hurry.
    $5,000
    $500,000
    Annual business revenue of at least $42,000, at least 9 months in business, personal credit score of 550+.
    Lendio Business Loan Marketplace
    Submit one simple application to potentially get offers from a network of over 75 legit business lenders.
    $500
    $5,000,000
    Must operate a business in the US or Canada, have a business bank account and have a personal credit score of 560+.
    OnDeck Small Business Loans
    A leading online business lender offering flexible financing at competitive fixed rates.
    $5,000
    $500,000
    Must have been in business for at least one year with annual revenue of $100K+. Must have a personal credit score of 500+.
    Lending Express Business Loan Marketplace
    $5,000
    $500,000
    At least 3 months in business and $10,000+ in monthly revenue. Your business might also qualify if it's been in business at least 6 months with $3,000+ in monthly revenue.
    Fora Financial Business Loans
    No minimum credit score requirement and early repayment discounts for qualifying borrowers.
    $5,000
    $500,000
    Business age 6+ months. Monthly revenue $12,000+. No open bankruptcies.
    LendingClub Business Loans
    With loan terms that vary from 1 to 5 years, enjoy fixed monthly payments and no prepayment penalties through this award-winning lender.
    $5,000
    $300,000
    2+ years in business; $50,000+ in yearly sales; No bankruptcies or tax liens; At least 20% ownership of your business; Fair or better personal credit
    LendingTree Business Loans
    Multiple business financing options in one place including: small business loans, lines of credit, SBA loans, equipment financing and more.
    Varies by lender and type of financing
    Varies by lender and type of financing
    Varies by lender, but you many require good personal credit, a minimum business age and minimum annual revenue.
    National Business Capital Business Loans
    Get a large business loan to cover your financing needs, no matter what the purpose is. Startups welcome with 680+ credit score.
    $10,000
    $5,000,000
    Your company must have been in business for at least 6 months and have an annual revenue of at least $180,000.
    Kabbage Small Business Line of Credit
    A simple, convenient online application could securely get the funds you need to grow your business.
    $500
    $250,000
    Must have been in business for at least 1 year. Revenue minimum is $50,000 annually or $4,200 per month over the last 3 months.

    Compare up to 4 providers

    What do I need to apply?

    Depending on the lender you approach and the whole of your needs, you may need more or less documentation.

    • Relevant licenses. It may be necessary to provide proof that you’re certified to do heating, ventilation and air conditioning work in your area. Make sure to keep copies of up-to-date licenses.
    • Personal documents. Some lenders will consider your personal credit as well as your business finances. In such cases, you may need to present personal bank statements. You’ll also want to have state or government-issued ID, such as a driver’s license or passport.
    • A business plan. Lenders are always looking to minimize risk. Approaching with a thought-out business plan presents a much safer image, and shows that you’re looking to run a successful business.
    • Proof of income. Lenders may also look at your business revenue and personal income when considering business financing. Ready your previous year’s taxes, business and personal bank statements.

    4 tips on getting financing for your HVAC company

    1. Review qualifications before applying. First making sure your business meets minimum eligibility can save you a lot of time. If it doesn’t and you’re set on working with that lender, it may be time to make an appointment and discuss your case before fully applying.
    2. Make sure your business plan shines. Show that you know what you’re doing, and show it on paper. A well-crafted business plan can really make an impact on a lender.
    3. Have the experience to back your plan. Keep a detailed record of your experience as an HVAC professional, including your training and other locations you’ve been licensed in.
    4. Keep data on your revenue. Show what you’re doing through easily consumable data. Show how the loan will factor into you existing business through a chart. Remember that you’re looking to increase trust with the lender, and transparency can help.

    6 tips to beat out your big-time HVAC competitors

    1. Treat every job like your reputation depends on it. Be kind, courteous and on time to the best of your ability. Clearly communicate any change in timing or potential costs. If you have contractors performing on-the-site services, be sure they’re representing your company with professionalism.
    2. Know your work and revenue before you grow. It can be tempting to expand full-throttle when you have the chance, but make sure your business will keep up with that growth throughout the year. Account for seasonal lulls to avoid ending up with too many employees and too few jobs.
    3. Don’t be shy about encouraging reviews. When you invest time into directing people toward review sites you’ve registered with, like Yelp or Google, you can grow your reputation. It’s good marketing that costs you little more than a friendly smile.
    4. Know your product and services. Talk to your customers about their options. Give professional recommendations backed by experience. But also listen to your customers’ wants, framing your pitch with them in mind.
    5. Build trust in your community. Big names are recognizable, but they aren’t always personal. Building goodwill earns respect that can lead to both recognizing your name and knowing that your HVAC comes from someone good within the community.
    6. Keep competitive rates. Even if you can’t match the leading competitor, getting close and staying true to your community can help customers see your business as friendlier and reliable, with the bonus of fair prices.

    Bottom line

    You’ve got a plan on lock. Now it’s time to follow through and take your HVAC business forward. To best prepare for success, address potential pain points ahead of applying for financing.

    When ready, compare your options carefully and ask questions as they arise to get the best deal you’re eligible for.

    Frequently asked questions

    Rhys Subitch

    Rhys Subitch is a content creator and editor for finder.com. They specialize in updating information on various pages to keep everything accurate for the readers, and enjoy the time they get to spend researching various topics because of it. Rhys lives with their cat and partner in Seattle. When not working they enjoy working on sewing and other craft projects.

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