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    Credit Analysis·BCP-2026-005

    Bad Credit Equipment Financing Report

    Approval rates, rate premiums, and recovery pathways for sub-650 borrowers

    Published April 18, 202620 pages · 11 min readBrobas Capital Research
    41%
    Approval rate, 550–599 FICO
    +5.2pp
    APR premium, sub-650
    85 pts
    Avg 12-mo score gain
    32%
    Of applicants are sub-650
    Primary sources:Experian Credit Trends · FICO Public Data · Brobas Capital Underwriting Data 2024
    Abstract

    A meaningful share of equipment financing applicants present FICO scores below 650. This report uses 4,200+ Brobas Capital underwriting records to quantify the distribution of those applicants, their realistic approval probability by score band, the rate premium they pay, and the recovery pathways that meaningfully change outcomes within 6–12 months.

    Section 01

    Credit Score Distribution

    Across 4,200+ equipment financing applications submitted to Brobas Capital in 2024, 32% of applicants presented a primary FICO score below 650. The single largest band was 600–649.

    FICO distribution of equipment financing applicants
    Brobas Capital application database, 2024 (n=4,200+)

    Источник: Brobas Capital Research, 2024–2026
    Section 02

    Approval Rates by FICO Range

    Approval rates rise sharply between the 550–599 and 650–699 bands, reflecting the transition from non-traditional-only lender pools to mainstream lender access.

    Approval rates by FICO band
    Approved through funding, all lender pools

    Источник: Brobas Capital Research, 2024–2026
    Section 03

    Rate Premiums Across Tiers

    The cost of borrowing for sub-650 applicants is materially higher. On a $90,000 60-month loan, the differential between a 720 borrower and a 580 borrower is roughly $22,400 in additional interest expense over the life of the loan.

    Total cost of capital, prime vs non-traditional
    $90,000 used Cascadia, 60-month equipment loan
    Параметр Prime borrower (720 FICO) Alternative-Credit borrower (580 FICO)
    Down payment 10% ($9,000) 20% ($18,000)
    APR 7.5% 17.5%
    Monthly payment $1,624 $1,810
    Total interest paid $16,440 $36,600
    Origination fee $0–$900 $1,800–$3,600
    Personal guarantee Often optional Always required
    Total cost difference Baseline +$22,400
    Источник: Brobas Capital Research, 2024–2026
    Section 04

    Recovery Roadmap

    Borrowers who follow a structured 12-month credit recovery program (Brobas Capital "Credit Recovery" framework) gain an average of 85 FICO points, materially improving access to prime equipment lenders.

    12-month credit recovery roadmap
    From 580 to 680+ FICO — Brobas Capital framework
    1. Month 1: Pull all 3 bureau reports
      AnnualCreditReport.com. Dispute errors, identify collections, calculate utilization.
      Week 1
    2. Month 1–2: Open secured credit card
      Discover Secured or Capital One. $200 deposit. Keep utilization <10%.
      30 days
    3. Month 2: Credit-builder loan
      Self / Credit Strong, $25/mo for 12 months. Adds an installment trade line.
      12 months
    4. Month 3–6: Authorized user add
      Family member with long history and low utilization adds applicant.
      90 days
    5. Month 6: Settle collections
      Pay-for-delete letters on accounts <$500. Focus on most recent.
      60 days
    6. Month 9–12: Equipment loan ready
      Score typically 660+. Eligible for prime equipment financing.
      Goal
    Источник: Brobas Capital Research, 2024–2026
    Cite this report

    Brobas Capital Partners Research. (2026). Bad Credit Equipment Financing Report. Report BCP-2026-005. Retrieved from https://brobascap.com/publications/bad-credit-equipment-financing-report

    About this research

    Brobas Capital Research is the in-house analytics arm of Brobas Capital Partners, a commercial finance advisory firm headquartered in Chicago. Reports combine internal underwriting data with public sources (J.D. Power, ATRI, ACT Research, BLS, Census).

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