How to qualify for corporate only equipment financing
Corporate only means the company signs and no owner personally guarantees the debt. Here is what it takes to be approved that way, and what to do if you are not there yet.
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What is corporate only equipment financing?
Corporate only (“corp only,” or a “no-PG” deal) means only the business is responsible for the debt. The owners sign as officers of the company, not as guarantors. The paperwork is the same as any other deal: an equipment finance agreement, a capital lease, an FMV lease, or a sale-leaseback. The guaranty section is simply left off.
A personal guarantee is standard on small-ticket equipment deals, usually from every owner with a 20 percent stake or more. Corporate only is the exception, and it is underwritten as one.
The terms, because they get used loosely
If someone says a deal is corp only, ask whether the approval is corp only or whether corp only is just being considered. Those two answers are weeks apart.
Why the personal guarantee exists
A personal guarantee does three jobs. A corporate only file has to cover all three without it.
- Recovery. If the company defaults and the equipment sells for less than the payoff, the shortfall can be collected from the owner.
- Alignment. A corporation can be dissolved or walked away from. A person cannot.
- Information. A personal credit report is fast, cheap, and predictive. When a business has a thin file, it is often the only real data available.
For most small businesses, the owner and the company are the same thing financially. Corporate only becomes possible when the company has its own history, its own credit identity, and enough substance that the owner’s balance sheet no longer matters.
The five things an underwriter checks
1. Time in business
Two years is the usual minimum to be considered. Three or more is where corporate only becomes realistic. Five or more opens up a lot more. Companies with one or two owners face a higher bar at some programs: ten or more years, plus prior corporate only borrowing. The fewer people who control a company, the more it behaves like an individual, and the more an underwriter wants that individual on the paper.
Standing is the easiest part to fix and the most often overlooked: active with the state, a federal EIN, a business bank account, a listed business address and phone, a free D-U-N-S number from Dun & Bradstreet, and stable ownership. A recent change of control resets the clock.
2. Business credit scores
With no guarantee, the business credit file becomes the main credit report. Most owners have never looked at theirs. Pull all of them before you ask for corporate only terms.
Score bands are published bureau definitions. Cutoffs are set by each program’s credit policy, not by the bureaus.
3. Comparable borrowing history
This decides most corporate only files. It gets its own section below.
4. Financial capacity
Without a guarantee, the company has to show on paper that it can carry the payment. The usual benchmarks:
General benchmarks, not approval criteria. Actual requirements vary by program, industry, equipment type, and deal size.
5. Public records
With no guarantor to fall back on, anything that hints at financial stress gets weighed heavily. Open tax liens, judgments, prior repossessions, lawsuits, or a bankruptcy anywhere in the company’s history will end most corporate only requests, even when everything else is strong.
Comparable credit: the requirement that decides most files
Comparable credit (“comps”) means prior or current borrowing in the company name only, at or near the size you are asking for now, paid as agreed. It is the most common reason a strong company gets declined for corporate only, and the requirement owners understand least.
The logic is simple. Someone being asked to extend $300,000 with no personal recourse wants proof that someone else already did something similar and got paid back. Financial statements show capacity. Comparable credit shows behavior. Behavior is the better predictor.
- Corporate only obligations count most. A prior equipment agreement, lease, term loan, or line of credit in the company name with no personal guarantee.
- It has to be reported. If it is not on PayNet, Experian Business, or D&B, underwriting cannot see it. A loan from a local bank that does not report is the most common invisible comp.
- It has to be comparable in size. A common standard is 50 to 100 percent of the request. A $25,000 tradeline does not support a $400,000 ask.
- It has to be seasoned and clean. Twelve months or more, paid as agreed throughout. One 30-day late does more damage here than on a guaranteed file.
What does not count: supplier net-30 accounts, business credit cards, anything an owner guaranteed, and the owner’s personal credit, no matter how strong.
That is why a profitable company with $40 million in revenue and no borrowing history can be declined for a $200,000 corporate only request, while a $6 million company that has quietly financed and paid off four machines gets approved.
Corporate only is a credit-history product. Size helps. History decides.
How deal size changes what you submit
A $240,000 request and a $260,000 request can be two weeks apart in funding time.
If you are near a threshold, find out where it sits before you structure the purchase.
When full corporate only is not available: the middle ground
Most files that ask for corporate only and do not get it are not simply declined. They come back with a structure that reduces personal exposure without removing it. These are often better outcomes than holding out, and they are negotiable:
- Limited guaranty. Personal liability capped at a fixed amount or a percentage. A guarantee capped at 25 percent of a $400,000 deal is a very different risk than an unlimited one.
- Burn-off guaranty. The guarantee releases after a set period of clean payments, usually 12 to 24 months. Ask for it in writing at the start. It is much harder to add later.
- Validity guaranty only. You stand behind the accuracy of what you submitted, not the repayment.
- Corporate or parent guaranty. An affiliate you own, a real-estate holding company, or a parent company signs instead of you.
- More down, shorter term, or more collateral. Twenty to thirty percent down is the most reliable lever on a borderline file. A 36-month term carries far less risk than 84. A blanket UCC-1 can bridge the gap, but it covers all business assets and will complicate your next financing, so know what you are trading.
Who gets corporate only almost automatically
Public and investment-grade companies, because audited financials and public disclosure do the guarantee’s job. State and local governments, which finance through tax-exempt municipal lease purchase agreements with a non-appropriation clause instead of a guarantee (and a lower rate, because the interest is tax-exempt). Established 501(c)(3) non-profits with audited statements and reserves. Private-equity-backed companies with diverse ownership. And subsidiaries of creditworthy parents, where the parent guaranty replaces a personal one.
What corporate only costs
Removing the guarantee removes a recovery source, and that gets priced. Expect it to show up as a higher rate (modest on strong credits, larger on borderline files), more money down, a shorter term, more paperwork and time (weeks, not days, above the application-only threshold), and on larger deals, ongoing reporting and stricter insurance requirements.
Run the comparison honestly. If the guaranteed deal prices much better and your company’s balance sheet is the only thing that would be exposed anyway, the guarantee may be the cheaper answer. Corporate only matters most when there is real personal exposure to protect: a home, other business interests, or a pending personal loan where a contingent liability would count against you.
What kills a corporate only request
- Stacked merchant cash advances. The most damaging item here. Many credit policies decline corporate only outright on any open MCA.
- Open tax liens or judgments. Most policies decline on an open lien. Even a payment plan in good standing narrows options.
- A thin or empty business credit file. The company may be excellent and simply invisible.
- Overdrafts and NSF activity on the bank statements.
- A recent change of ownership or entity. A new EIN starts a new credit history.
- Commingled finances. Personal expenses through the business says the company is not really separate, which is the whole premise of the request.
- Declining revenue or a recent loss. Fixable with a strong explanation and interim figures, but it will be asked about.
- Industry. Long-haul trucking, restaurants, and construction subcontractors sit at the harder end. Medical, dental, manufacturing, and professional services sit at the easier end.
How to get there in 12 to 24 months
If you do not qualify today, the path is well marked. Most companies that reach corporate only got there on purpose, roughly in this order:
- Get the entity clean. Good standing with the state, an EIN, a listed address and phone, a business-only bank account, and a D-U-N-S number.
- Stop commingling. Business money through business accounts only.
- Open tradelines that actually report. Three to five reporting suppliers paid on time will build a PAYDEX and move it toward 80.
- Take a guaranteed equipment deal and pay it perfectly. This is the step most owners skip, and it matters most. A repaid obligation in the company name is the raw material of comparable credit. Paying cash builds nothing.
- Step the size up. $50,000, then $150,000, then $400,000 over three deals is a normal path. Jumping from nothing to $400,000 corporate only is not.
- Ask for a burn-off on the way. When you sign a guarantee, negotiate a release after 12 to 24 months of clean payments.
- Upgrade your financial statements as you grow. Internal statements are fine under $250,000. CPA-compiled or reviewed is expected in the middle range. Audited is the norm above $5 million.
- Stay away from MCAs, and check the business bureaus once a year for errors.
What to have ready when you apply
A complete file gets a real answer. One that arrives in pieces gets a guarantee request, because underwriting defaults to the safer structure when it cannot see enough. Have these ready:
- A signed application with the corporate only request stated up front
- Three years of business tax returns
- Two to three years of year-end financial statements, plus a current interim P&L and balance sheet
- Three to six months of business bank statements
- A current debt schedule, plus AR and AP aging reports
- The equipment quote or invoice, with the vendor named
- Formation documents and a certificate of good standing
- A certificate of insurance naming the finance company as loss payee and additional insured
- Business credit references, including any prior corporate only obligations and who financed them
That last item does more work than it looks. Naming your prior corporate only obligations hands the underwriter the comparable credit argument directly.
Three things people get wrong
Corporate only does not mean no personal credit check. Many programs still pull the owner’s credit, usually as a soft inquiry, to screen for personal bankruptcies, liens, and judgments.
Corporate only does not mean no consequences. The company is fully liable. On default, the equipment can be repossessed, the company can be sued for the shortfall, and the default goes on the commercial bureaus. If the information submitted was false, personal liability generally comes back.
Forming an LLC or buying an aged corporation does not create eligibility. Underwriters know what a shelf entity with no operating history looks like, and the bureaus flag them. There is no shortcut around operating history and repayment behavior.
Does corporate only change the tax treatment?
No. The structure of the agreement is what matters, not who guarantees it. Equipment finance agreements and $1-buyout structures are generally treated as ownership, which makes the equipment eligible for Section 179 and bonus depreciation. True fair-market-value leases are generally treated as rentals, with the payments deducted as an operating expense.
For 2026, the Section 179 limit is $2,560,000, with the phase-out starting at $4,090,000 of qualifying property placed in service and ending at $6,650,000. Bonus depreciation is back at 100 percent for qualifying property acquired and placed in service after January 19, 2025, under the One Big Beautiful Bill Act. The usual order is Section 179 first, then bonus depreciation on what is left.
Tax figures are the published limits for the 2026 tax year and are general information only. Five West Financial does not provide tax advice. Confirm treatment with your CPA.
Where corporate only requests fit in our programs
Corporate only is a real program with us rather than a marketing line, and it is underwritten as one. Here is the honest shape of what is available and what it takes.
- Structures
- EFA and $1 buyout, capital lease, FMV lease, sale-leaseback
- Application only
- Commonly to $250K, and to $500K on qualifying bank programs
- With full financials
- $500K into the eight figures on structured transactions
- Time in business
- 3+ years typical, 10+ at some programs for closely held companies
- Business credit
- PAYDEX 70+ with comparable borrowing history reporting
- Credit pull
- Soft inquiry to preview. No effect on any score.
General program parameters, not an offer or commitment. All financing is subject to credit approval. If corporate only does not fit your file, we will tell you what structure does and why, rather than submitting a request that will not clear.
The bottom line
Corporate only is not a better version of a normal approval handed to better borrowers. It is a different question. A guaranteed file asks whether the owner can repay. A corporate only file asks whether the company already has.
That is why the criteria cluster around history, not size: two years minimum and three or more to be realistic (ten at some programs for closely held companies), a PAYDEX of 70 or better, comparable borrowing at half the request or more, and financials showing 1.25x coverage. A company with those four things has an argument. A company without them has a project, and a well-defined one.
If you are somewhere in between, the middle-ground structures are usually the right answer. A limited guarantee, or a full one with a 12-month burn-off, protects most of what corporate only would protect, and gets funded now instead of in two years.
Frequently asked questions
What is corporate only equipment financing?
Corporate only, or corp only, equipment financing is a deal where the business is the only party responsible for the debt and no owner signs a personal guarantee. The owners sign as officers of the company. Recovery is limited to the company and the financed equipment.
How do you qualify for equipment financing with no personal guarantee?
Four things carry most corporate only approvals: two years in business at minimum and three or more to be realistic (ten or more at some programs for closely held companies); a business credit file with a D&B PAYDEX of 70 or better; comparable borrowing in the company name at 50 to 100 percent of the request; and financials showing debt service coverage of about 1.25x. A clean public record, with no open tax liens, judgments, or merchant cash advances, is also required.
What is comparable credit in equipment financing?
Comparable credit means prior or current borrowing in the business name only, at or near the size being requested, paid as agreed and reported to a commercial credit bureau. It is the most common deciding factor on corporate only files. Supplier accounts, business credit cards, and personally guaranteed loans do not count.
How much revenue do you need for corporate only financing?
There is no universal threshold. On small-ticket files, a common benchmark is annual revenue of at least ten times the amount financed. Revenue alone does not qualify a company. A business with big revenue and no commercial borrowing history is usually declined for corporate only in favor of a smaller company with an established repayment record.
Is corporate only financing more expensive?
Usually, yes. Removing the personal guarantee removes a recovery source, and that is priced in: a higher rate, a larger down payment, a shorter term, more documentation, or covenants. On strong corporate credits the difference is modest. On borderline files it can be significant.
Does corporate only mean my personal credit will not be checked?
No. Many programs still pull the owner’s personal credit on a corporate only file, generally as a soft inquiry, to screen for personal bankruptcies, tax liens, and judgments. No guarantee is signed, but the owner’s record is still treated as information about the business.
What is a burn-off guarantee?
A burn-off guarantee is a personal guarantee that is released after a set performance period, commonly 12 to 24 months of on-time payments, or on reaching a stated financial target. It is often the most practical outcome for a company that is close to corporate only eligibility, and it is granted more often than borrowers ask for it.
Can a new business get corporate only equipment financing?
Effectively no. Corporate only underwriting rests on operating history and demonstrated repayment, which a new entity does not have. Forming an LLC or buying an aged shelf corporation does not create eligibility. The realistic path for a newer company is a guaranteed deal, ideally with a burn-off negotiated at signing.
Do municipalities and non-profits need a personal guarantee?
No. State and local governments finance through tax-exempt municipal lease purchase agreements, which carry a non-appropriation clause instead of a guarantee. Established 501(c)(3) non-profits with audited financial statements are also routinely financed on the entity alone.
Find out whether your file clears corporate only.
One short application and a soft credit pull. We will tell you which structure your business actually qualifies for, and what would need to change if it does not. Or run the numbers yourself first in the Quote Builder. No credit pull, no obligation.
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This article is general information about commercial equipment financing and is not a commitment to finance, nor is it tax or legal advice. All financing is subject to credit approval and underwriting. Rates, terms, structures, and approval depend on the complete business and credit profile. Credit score ranges cited are published bureau definitions; individual lender requirements are set by internal credit policy and vary.