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Restaurant Equipment Financing

Restaurant Equipment Financing

Commercial kitchens, refrigeration, dishwashing, POS, and full restaurant build-outs. From independent restaurants to chain franchises.

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Founder & Editor · Expertise: Equipment financing, Lender matching, Loan and lease structure
Last reviewed
Methodology
Sources: partner-lender program data + industry research Editorial standards: methodology Disclosures: advertising + lender relationships
$10K-$500K
Funding range
single piece to full kitchen
9%-18%
Typical APR
restaurant industry premium
36-72mo
Term length
with seasonal options
E
Reviewed by Ed Stapleton Jr. · Founder & Editor

Restaurant equipment financing covers loans, leases, and equipment finance agreements (EFAs) for businesses purchasing equipment in the restaurant category. We finance new and used equipment across all major brands, with rate ranges driven by credit tier, asset price, and equipment type.

What we cover in Restaurant

This category includes 39 equipment types, representing about 195,280 monthly searches. Common items include Donut Machines, Rotisserie Ovens, Conveyor Ovens, Commercial Ranges/Stoves, Commercial Steamers.

Asset prices in this category range from $6,500 to $35,000+, depending on the specific equipment, age, and configuration. We finance new equipment up to 100% of cost (excellent credit) and used equipment up to 80% of appraised value, with terms matched to the equipment’s useful life.

Typical financing structure for restaurant equipment

Credit tier APR range Term Down payment
Excellent (720+) 6.9-9.9% 60-84 mo 0-10%
Good (680-719) 9.9-13.9% 48-72 mo 5-15%
Fair (640-679) 13.9-17.9% 36-60 mo 10-20%
Challenged (below 640) 17.9-24.9% 24-48 mo 15-30%

Rate ranges as of May 2026, blended across our partner-lender network. Your actual rate depends on credit, equipment, term, and lender. See methodology.

How restaurant equipment financing works

  1. Apply for soft-pull pre-qualification. Tell us what you’re buying, asset price, business basics, credit profile.
  2. Get matched to a partner lender that specializes in restaurant equipment and your credit tier.
  3. Receive an indicative quote with rate, term, and structure within hours.
  4. Move to full underwriting if you accept the quote. Hard pull, financials review, equipment verification.
  5. Sign and fund. Most restaurant deals fund within 1-7 business days.

Common questions about restaurant equipment financing

Can I finance used restaurant equipment?

Yes. Most lenders finance used equipment up to 10-15 years old at maturity, with 80-90% LTV based on appraised value. Sometimes a third-party inspection is required for deals over $25K.

What credit score do I need?

Excellent rates require 720+ FICO. Sub-prime equipment lenders accept down to 580 with compensating factors (revenue, down payment, time in business). See our credit tier guide.

Does restaurant equipment qualify for Section 179?

Almost all business equipment qualifies for Section 179 deduction up to $1.22M (2026 cap). Financed equipment qualifies in the year placed in service. See our Section 179 guide.

How long does approval take?

Small-ticket equipment (under $50K) funds in 1-3 business days. Mid-ticket ($50K-$500K) in 3-7 days. Large-ticket ($500K+) in 1-3 weeks.

Case study
Casual dining concept finances $185K full kitchen build-out

Second location for established 8-year casual dining group. Strong personal credit and existing-location performance. Closed with restaurant-specialty lender at 11.4% APR, 60-month term, 15% down. Combi oven, walk-ins, dish line, hood, and POS system all included.

$185K Kitchen cost
11.4% APR
60 mo Term
$28K Down payment

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Browse all Restaurant equipment

45 equipment types in this category. Each links to a dedicated financing page with rates, terms, and lender notes.

What to know about financing restaurant equipment

Restaurant equipment finance handles one of the smallest-ticket but highest-volume equipment categories in our partner network. Average transaction sizes run $25,000-$120,000, applications close fast when the file is clean, and the buyer pool ranges from owner-operator single-unit restaurants to multi-location franchise groups. Our programs match that spread, with app-only paths to $150K and full-financials programs above that line.

The dominant pattern on restaurant equipment is that the buyer is often newer to the asset class than to the business. A restaurant operator buying their fifth location knows the operations but may be making their first commercial-grade ice machine purchase, or their first walk-in cooler. The equipment finance details often surprise even seasoned operators, particularly around delivery, installation, and service contract terms.

The other distinguishing feature: restaurant equipment is heavily seasonal in both supply chain and lender appetite. Equipment delivery cycles run 6-16 weeks for major appliance categories. Lenders that specialize in restaurant equipment time their underwriting and funding around opening dates, which can compress decision cycles when timelines slip.

Rate ranges we have seen on restaurant financing

Pulled from the deals our partner lenders quoted us in the last 12 months. Your actual rate depends on credit, time in business, equipment year/hours, and structure. Treat these as starting reference points, not quotes.

Credit profile 36-month term 48-month term 60-month term Typical down
720+ Excellent, established operation 7.5 - 8.8% 7.8 - 9.2% 8.1 - 9.6% 0%
680-719 Good 8.6 - 10.0% 9.0 - 10.5% 9.4 - 11.0% 0 - 5%
640-679 Fair credit 10.2 - 12.0% 10.7 - 12.6% 11.2 - 13.2% 5 - 10%
First-restaurant owner, principal 700+ 10 - 12.5% 10.5 - 13% 11 - 13.5% 10 - 20%
Credit challenged or restart 13.5% + Limited Rare 20 - 30%

Franchise-affiliated buyers often access dedicated programs at preferential rates when the franchisor has an active lender relationship. Used restaurant equipment over 8 years old typically requires shorter terms.

Three deals we routed in the last quarter

Each scenario below is a real structure from our partner lender network, with identifying details removed. The borrower-profile, equipment, and structure are accurate; the price points are within five percent of actual.

Scenario 1

Casual-dining concept opens third location

Borrower
7-yr operator, 735 FICO, 2 existing units, $4.8M aggregate revenue
Equipment
Full kitchen build-out: ovens, fryers, walk-in cooler, ice machine, prep tables = $185,000
Structure
60-month EFA, 0% down, $1 buyout
Payment
$3,720/mo, 8.4% APR equivalent

Outcome: App-only approval same day. Lender bundled all equipment onto single paper aligned to the opening date.

Scenario 2

Franchise opens first location

Borrower
Pre-revenue, principal 730 FICO with prior franchise ownership
Equipment
Branded equipment package per franchise spec, $148,000
Structure
60-month loan, 10% down, principal PG
Payment
$3,065/mo, 9.6% APR

Outcome: Approved through franchise-program pricing given the franchisor's lender relationship. Funded coordinated with the construction completion date.

Scenario 3

Independent coffee shop replaces espresso machine

Borrower
4-yr shop, 700 FICO, $620K revenue
Equipment
La Marzocco Strada EP-3 used, $18,500
Structure
36-month EFA, 0% down, $1 buyout
Payment
$580/mo, 9.2% APR equivalent

Outcome: App-only same-day approval. Used premium-brand equipment financed on standard terms given the strong resale value on this asset class.

Lender programs in our partner network for restaurant

The programs below describe the buckets our partner lender network underwrites for this equipment. We route every application to the program that fits the credit profile, time in business, and structure preference. The program assignment is the single biggest driver of rate, term, and approval speed.

Standard prime program

App-only to $150K for established restaurant operations with 24+ months in business and prime credit. Fastest approval path on standard equipment categories.

  • Min credit: 720
  • Min time in business: 24 months
  • Typical advance: 100% new, 90% on used to 5 years
  • Best for: Established operators, replacement deals, prime credit

Franchise specialty program

Built for franchisees buying branded equipment packages per franchisor spec. Often includes pre-approval frameworks negotiated with the franchisor, which compresses funding timelines.

  • Min credit: 680
  • Min time in business: 0 months (with franchise system experience)
  • Typical advance: 85-95% with franchisor letter of support
  • Best for: Franchisees opening new units, established franchise systems

Multi-location build-out program

Underwrites full-kitchen builds with bundling across multiple equipment categories on single paper. Aligns funding to construction completion.

  • Min credit: 660
  • Min time in business: 12 months
  • Typical advance: 95-100% bundled
  • Best for: Build-outs, expansion locations, integrated kitchen packages

First-restaurant owner program

Recognizes prior industry experience (chef, GM, multi-unit operator background) as substitute for entity history. Larger down payment required but a real path for first-time owners with strong principal credit.

  • Min credit: 700
  • Min time in business: 0 months (industry experience required)
  • Typical advance: 80-90% with PG and pipeline letter
  • Best for: First-restaurant owners, hospitality-industry transitions

What an underwriter will ask about restaurant

These are the questions we hear our partner lenders ask on every restaurant application. Preparing answers in advance closes the deal one to three business days faster.

  1. Concept type and price point? QSR, fast casual, full-service, and fine dining have different cash flow profiles and average ticket sizes.
  2. Existing location or new build? Replacement equipment on a known operating unit underwrites cleaner than equipment for a new location.
  3. Opening or completion date? Restaurant equipment funding often aligns to a target opening date. Schedule slippage is common and affects payment start.
  4. Service contract and warranty terms? Commercial kitchen equipment service is expensive. Lenders document this for total cost of ownership analysis.
  5. Franchise affiliation? Franchise affiliation can unlock dedicated programs at preferential pricing if the franchisor has an active lender relationship.
  6. Operator background and prior restaurant ownership? Industry experience strengthens new-restaurant applications and can substitute for short business history.

Issues specific to restaurant deals

These are not the standard equipment-finance pitfalls. They are the patterns we see on this exact equipment, in this exact market, that buyers without recent experience tend to miss.

Equipment delivery and installation timing slips

Restaurant equipment delivery often runs 6-16 weeks for commercial-grade appliances. Schedule slips push the placed-in-service date, which can affect both opening timeline and the financing payment-start window. Build buffer time into both.

Service contracts not budgeted

Commercial kitchen equipment requires routine service (refrigeration, ice machines, ovens). Annual service contracts cost 5-15 percent of equipment price. Buyers focused on the equipment cost often underbudget the ongoing service spend that follows.

Used equipment without warranty or service path

Used restaurant equipment, particularly from auction or restaurant closures, often comes without manufacturer warranty or authorized service eligibility. The cost savings can reverse when service is needed and OEM technicians decline to work on out-of-channel units.

Health department requirements not met by equipment selection

Different jurisdictions have different requirements on commercial kitchen equipment (NSF certification, refrigeration capacity per food type, handwashing station counts). Buyers sometimes purchase equipment that does not meet local requirements, which surfaces at inspection. Confirm with the local health department before financing.

Documents the vendor must produce on restaurant

Lenders fund off documents, not promises. The items below are the ones we have seen hold up funding on restaurant deals. Confirm each is in hand before signing.

  • Bill of sale itemized by equipment line. Each major appliance and supporting equipment separately listed. No package totals.
  • NSF certification documentation. Required for most commercial kitchen equipment. Certificate copies before signing.
  • Manufacturer warranty terms in writing. Warranty period, what is covered, who provides service, and at what response time.
  • Installation scope and responsibility. Plumbing, gas, electrical, exhaust hood ventilation. Who does what, who pays for what.
  • Service contract terms (optional but document). Service provider, response times, parts coverage, and annual cost. Often a separate negotiation from the purchase.
  • Delivery and commissioning schedule. Confirmed delivery window aligned to construction completion. Penalty terms for late delivery.

Resale and depreciation on restaurant

Restaurant equipment has a mixed depreciation profile. Workhorse categories (commercial ovens, ranges, refrigeration) hold value reasonably well in years one through five because the secondary market is broad (other restaurant operators, food trucks, small commercial kitchens). Premium specialty equipment (high-end espresso machines, custom pizza ovens, specialty cookware) can hold value extremely well, with brands like La Marzocco and Rational sometimes selling at 60-70 percent of original price at year five.

The depreciation curve flattens after year five because the equipment continues operating in many restaurants for 10-15 years. Used restaurant equipment auctions (Restaurant Equipment World, Empire Restaurant Equipment, regional auctioneers) move large volumes of equipment from restaurant closures and remodels. Auction pricing typically runs 30-50 percent of dealer-quoted used value, which is a meaningful spread.

The other resale factor is brand-specific service network. Equipment from brands with strong authorized service networks (Hobart, Vulcan, True, Hoshizaki) holds value better than equipment from smaller brands where post-warranty service becomes the buyer’s problem.

Typical retained value
Year 1
70%
Year 3
52%
Year 5
38%
Year 7
25%

Who finances restaurant equipment

Buyers shopping restaurant financing come from a few distinct backgrounds. The four profiles below cover most of what we see. Lender match, structure, and pricing all shift across profiles even when the equipment is identical.

The seasonal operator

A business with revenue that concentrates in certain months. Lenders price this risk by either requesting larger down payments, asking for proof of working capital reserves, or structuring seasonal payment skips that match the revenue pattern.

The succession buyer

A family member, key employee, or partner buying out an exiting owner and continuing the operation. The equipment may transfer as part of the deal or be re-financed at the buyer side. Lenders need clarity on which is happening before they price the transaction.

The post-restructure operator

A business that has been through a workout, settlement, or bankruptcy in the last 24 to 60 months. Programs exist with the right lender, usually at higher rate, with larger down payment, and tied to a personal guarantee from a principal with current clean credit.

The replacement buyer

An established business swapping out a unit that has aged past its useful life. The story for lenders is the cleanest: a known revenue stream, a known asset, and a documented reason for the spend. These applications close fastest and at the best rates.

What lenders weigh on restaurant applications

The lender review on restaurant deals follows a fairly consistent set of weights across our partner network. The factors below carry the most influence on whether the deal funds and at what rate.

  • Bank statement analysis. Three to twelve months of business bank statements. Lenders look at average daily balance, monthly deposit count, NSF activity, and overall cash flow stability. This is where seasonal businesses get fairly priced if they have the records.
  • Use of equipment. Will the asset generate revenue immediately, will it replace an existing producing asset, or is it additive capacity. Revenue-replacement deals close most easily.
  • Personal credit of principals. For owners with 20 percent or more equity, personal FICO drives both the available program and the rate. The pull is soft at prequalification, hard at formal application with the chosen lender.
  • Business credit profile. D&B Paydex, Experian Intelliscore, and trade references from current vendors. Stronger business credit reduces personal-guarantee scope and improves the rate.
  • Owner background and depth. Years of related industry experience, prior ownership of similar equipment, and any documented success operating the asset class affect underwriting. New entrants to a class price differently from established operators expanding within their lane.

Tax treatment on restaurant purchases

Equipment financing has direct tax implications that vary with structure and with how the equipment is used. We summarize the main provisions below. Run any tax position through your CPA before relying on it.

Section 179 expensing

Allows a taxpayer to elect to deduct the cost of qualifying property as an expense in the year it is placed in service, subject to annual limits set by Congress. Most equipment used more than 50 percent for business qualifies. The election is made on Form 4562 with the tax return.

State conformity

States vary on whether they conform to federal Section 179 limits and bonus depreciation. A few states still cap Section 179 well below the federal amount or disallow bonus depreciation entirely. Your effective tax savings depend on both federal and state treatment.

Lease accounting under ASC 842

Under ASC 842, most operating leases come onto the balance sheet as right-of-use assets and lease liabilities. The income statement treatment depends on lease classification. Talk to your CPA about how the structure of your equipment financing flows through the financials.

Frequently asked on restaurant applications

What if the equipment will be cross-border or international?
Equipment that crosses an international border in the course of business (cross-border trucks, certain aviation) is financeable but requires the lender to confirm coverage in the equipment use. Cross-border use can also affect insurance, registration, and apportioned licensing.
Is there a minimum or maximum loan size?
Across our partner lender base, most programs run from a $10,000 minimum up to several million on a single transaction. The mid-range (roughly $25,000 to $500,000) has the deepest lender competition and best pricing.
Can I see all the offers, or only the one you recommend?
You see the offer or offers from the lender or lenders we route your application to. We route to the lender or lenders we believe match your profile best. If you want to compare against an offer you have independently, share it with us and we can route to a different lender for an alternative quote.
What is the difference between rate and APR on the disclosure?
Rate is the interest rate before fees. APR includes the rate plus mandatory fees (doc fee, origination, certain insurance) expressed as an annualized cost. APR is what you want to compare across offers, not the rate.
What if I want to upgrade the equipment mid-term?
You sell or trade out of the current equipment, pay off the existing loan from sale proceeds (plus any difference), and finance the upgrade. Some lenders streamline this through trade-up programs, especially within their portfolio of customers.

Quick answers

Direct answers to the questions we hear most on restaurant applications. Each answer is one we have given to a real buyer in the last quarter.

Do I need a personal guarantee?
Most equipment loans for small and mid-size businesses require personal guarantee from the principals. Large established businesses with strong financials sometimes get non-recourse structures. Startup and credit-challenged applications always require personal guarantee, often with spouse co-sign.
Can I finance equipment with a 600 FICO?
Yes. Programs exist for credit profiles below prime, typically requiring 10 to 25 percent down, a personal guarantee, and sometimes a contract or invoice supporting the use. Rates run 4 to 8 points above prime, and term length often caps at 48 months instead of 60 or 72.
Do I need business credit to finance equipment?
No, personal credit is typically the primary factor for small and mid-size businesses. Business credit (D&B PAYDEX, Equifax Business, Experian Business) matters more on larger transactions and for established businesses. Building business credit over time supports better terms on subsequent deals.
What is a balloon payment?
A balloon payment is a large final payment at the end of a loan term that is not fully amortized through monthly payments. Common on shorter terms with longer-life equipment. Borrowers either refinance the balloon at end of term, pay it cash, or include it in budgeting from day one. Most equipment loans amortize fully without balloons.
What is the typical APR on equipment financing?
Standard prime credit equipment financing runs 7 to 11 percent APR depending on equipment type, term length, and lender. Mid-tier credit runs 9 to 13 percent. Specialty programs for credit-challenged or startup borrowers run 12 to 18 percent. Manufacturer captive promotional financing can run 0 to 6 percent.
Is leasing better than buying equipment?
It depends on hold period and tax position. If you plan to keep the equipment past the financing term, loan or $1 buyout EFA typically wins. If you plan to cycle every 36 to 48 months, true lease structures often win. Section 179 election generally requires loan or EFA, not true operating lease.

How we route the decision

The financing structure that fits depends on the actual situation. Below are the most common decision branches we walk through with buyers, in plain "if X, then Y" form.

If You plan to bundle attachments with the base equipment
Then Get them all on a single bill of sale and single paper. Bundled financing typically costs 50 to 100 basis points less than financing the base unit and adding attachments separately.
If You expect rate environment to improve in the next 12 to 18 months
Then Consider open pre-payment structures or a shorter term you can refinance later. The trade-off is the upfront cost; the refinance option becomes valuable if rates drop 100+ basis points.
If You are planning a Section 179 election close to year-end
Then Confirm placed-in-service date can be hit before December 31. Equipment ordered but not delivered/commissioned does not qualify for current-year §179, regardless of payment status.
If You plan to keep the equipment past the financing term
Then Use a loan or $1 buyout EFA structure. Operating lease and FMV lease structures cost more on a keep-past-term basis because of the residual buyout.
If You have a signed customer contract that the equipment will fulfill
Then Include the contract in the application. Contract-backed equipment finance typically prices 50 to 150 basis points better than capacity-build financing on equivalent credit.

Timeline expectations

What actually happens day-by-day, from application to equipment in service. Most buyers underestimate one or two of these steps; knowing them up front prevents surprises.

Apportioned plate registration (trucking)
2 to 4 weeks
New-authority trucking operators need apportioned plates before crossing state lines. Plan this into the funding timeline; temporary trip permits bridge the gap at higher per-state cost.
Soft-pull pre-qualification turnaround
1 to 4 hours during business hours
Soft-pull pre-qualification surfaces lender matches and indicative rates within hours, without affecting credit score.
Lease end-of-term decision deadline
60 to 90 days before term end
Most lease structures require notice of intent (purchase, return, or renew) 60-90 days before term end. Missing the deadline can trigger automatic renewal or other default consequences.
Application submission to decision
24 hours to 5 business days
App-only programs decision same-day or next-day. Full-financials programs run 3-5 business days as the file moves through credit, then operations.
Wire transfer cutoff times
Typically 2-3pm PT / 5-6pm ET
After cutoff, wire processes next business day. Late-Friday signings often delay funding until Monday or Tuesday.
Title transfer on titled equipment
1 to 4 weeks
Title transfer through state DMV adds weeks to closing on titled equipment. Out-of-state transfers run on the longer end. Title escrow accelerates this in many cases.
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Common questions about Restaurant financing

Why are restaurant rates higher than other industries?

Restaurants have higher business failure rates (about 60% close within 3 years). Lenders price for that risk. Established multi-unit operators and franchised concepts get better rates.

Can I finance a startup restaurant?

Yes, but expect higher down payment (25-40%), shorter terms, and rates in the 15-22% range. SBA 7(a) is commonly used for restaurant startups. First-time restaurateurs without industry experience face the toughest underwriting.

Do franchisees get better rates than independents?

Generally yes. Franchised concepts (Subway, Domino's, Chick-fil-A, etc.) have standardized lender relationships and proven concepts. Lender pool is wider and rates are 2-4 points lower than equivalent independents.

Can I finance used restaurant equipment?

Yes. Refurbished commercial kitchen equipment has a strong used market. Dealer-certified used (with warranty) is most financeable. Auction wins financeable with pre-approval.

What about leasehold improvements (build-out beyond equipment)?

Equipment financing covers FF&E (furniture, fixtures, equipment). Leasehold improvements like flooring, walls, plumbing are real-property and need a separate loan or SBA 504 structure.

E
Reviewed by

Ed Stapleton Jr.

Founder & Editor

Ed Stapleton Jr. runs Fund My Equipment. Every page on this site is written and reviewed by Ed.

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