An Equipment Finance Agreement (EFA) is a hybrid product — contract structure of a lease (simpler doc set, faster underwriting) with the ownership outcome of a loan (you own at end with no buyout). Most common product in restaurant equipment financing because it's faster than SBA and more standardized than direct equipment loans. APR typically 7-20%, term 24-60 months, close in 3-5 business days. Tax treatment matches a loan (Section 179 eligible, interest deductible). Lenders push EFAs because the doc set is roughly half the size of a traditional loan agreement.
An Equipment Finance Agreement (EFA) is a hybrid product — contract structure of a lease (simpler doc set, faster underwriting) with the ownership outcome of a loan (you own at end with no buyout). Most common product in restaurant equipment financing because it's faster than SBA and more standardized than direct equipment loans. APR typically 7-20%, term 24-60 months, close in 3-5 business days. Tax treatment matches a loan (Section 179 eligible, interest deductible). Lenders push EFAs because the doc set is roughly half the size of a traditional loan agreement.
How to use this in your financing decision
Apply this directly to your build-out planning: model 2-3 financing scenarios using the calculators on this site, get written quotes from 3+ lenders before committing, factor Section 179 tax savings into your effective cost calculation. Most operators leave 4-8% APR on the table by accepting the first quote — comparison shopping pays for itself in week 1.
Common pitfalls to avoid
Three recurring mistakes: (1) accepting the first quote without comparing — rate spreads of 4-6% on the same applicant are normal across lenders, (2) maxing the loan term — feels cheaper monthly but costs $5K-$30K more in total interest, (3) skipping Section 179 in year 1 — leaves $5K-$25K on the table for the average operator.
Equipment Financing Calculator
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Frequently Asked Questions
Where do I start?
Use the restaurant equipment loan calculator on this site to model your specific scenario. Then apply to 2-3 lenders for written quotes. Most decisions come back in 24-72 hours.
How long does this typically take end to end?
Equipment financing: 24-72 hours from application to funding decision, 1-5 days to actual funding. SBA 7(a): 4-8 weeks. EFA: 3-5 days. Vendor financing: 24-48 hours.
What if I get declined?
Decline at one lender doesn't mean decline at all. Top decline reasons are credit score, time in business, and revenue ratio — fixable in 30-90 days. Restaurant-vertical lenders (Beacon Funding, Crest Capital) are usually more lenient than generalist equipment lenders.
What's the cheapest option?
SBA 7(a) at 8.5-11.5% APR is typically the cheapest single product. The trade-off is 4-8 week close timeline. For tight install timelines, equipment financing at 6-12% APR (for prime credit) is the next-cheapest option.
Ready to Get Funded?
Compare offers from multiple equipment lenders in one application.
Disclosure: Some links on this page are affiliate links. We may earn a commission when you complete a financing application via our partner. This does not change your rate or terms. We are not a lender, broker, or financial advisor.
VI
Reviewed by Vlad Ivanov AI+SEO operator at wordsatscale.com. 9 GSC-verified sites; founder of the SearchGAP Method community. Bio + portfolio at wordsatscale.com.
