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HVAC Financing: How to Grow Your Small Business

HVAC Financing: How to Grow Your Small Business

If you own a small heating, venting, and air conditioning business, you know what things are most challenging. You probably don’t worry about having the skills and experience to provide top-notch service to your clients. Most small business owners, including HVAC business owners, worry most about having the money they need to fuel their business growth, whether that means hiring new skilled employees or purchasing necessary equipment.

At Select Funding, we partner with HVAC business owners all the time, providing them with the working capital required to achieve their business growth goals. Our HVAC financing is easy to qualify for, with minimal underwriting requirements, and we can provide speedier approvals than traditional financing that you might obtain from a bank. Here’s what you need to know about how HVAC financing works—and how you can use it to grow your HVAC company.

How Do You Qualify for HVAC Business Financing?

The qualifications for HVAC business financing can vary greatly depending on where you go to obtain the money you need. Here’s an overview.

Bank/Credit Union Qualifications

These are the requirements for most small business bank or credit union loans:

  • In business for a minimum of two years
  • FICO score of 625 or higher
  • Annual business income of $250,000 or more

Many banks and credit unions also require collateral, which means you’ll need to put up something of value to secure the loan. It may take two weeks or more to get approved for the loan and up to four weeks to get your money after approval.

SBA Qualifications

The Small Business Association (SBA) provides loans to qualifying small businesses. Here are the underwriting requirements:

  • In business at least two years
  • Personal FICO score of 690 or higher
  • FICO Small Business Scoring Service (SBSS) score of 155 or higher
  • A debt service coverage ratio of 1.15 or higher

In many cases, especially for large loan amounts, you’ll also need to provide collateral. There is a detailed application process and it can take a month or more to get your money after you’ve been approved.

Online Lender Qualifications

Online lenders like Select Funding offer an alternative to traditional lending and often have less stringent underwriting requirements that make it easy to obtain the business financing you need. For example, here are our requirements at Select Funding, which apply for both small business financing and equipment financing:

  • One year in business
  • Annual receipts of $100,000 or more
  • A FICO score of 525 or higher

Our online application takes only a few minutes to complete. The only supporting documentation we require is six months’ worth of business bank statements, which we’ll use to verify your annual sales.

Unlike traditional lenders, we can approve your application in just a few hours and send your money in as little as 24 hours.

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What Are the Benefits of Business Financing?

Now that you understand the requirements to obtain business financing for your HVAC company, here are some of the benefits of getting small business financing.

Improved Cash Flow

The first benefit of small business financing is that it can improve and smooth out your business cash flow. For a lot of businesses, income may vary from month to month and that can make it difficult to stay up to date with your overhead expenses and to fund your growth.

With small business financing, you’ll have the money you need on hand to make your payroll, pay your rent, and advertise your business to attract new clients.

Higher Business Credit Scores

The next benefit is one that’s related to cash flow. If you don’t have predictable cash flow, it can be difficult to make on-time payments–and failure to do so can negatively impact your business credit score.

Small business financing allows HVAC companies to have the cash they need on hand to make regular monthly payments and by doing so, to improve their business credit scores.

Upgraded/New Equipment

Every small HVAC business needs equipment to run, whether that means the latest tools, the vehicles necessary to service your customers, or HVAC business software to streamline your operations.

Equipment financing is a form of small business financing that allows HVAC businesses to obtain tools, technology, and other equipment to help their businesses grow.

Better Customer Service

When you have the working capital to upgrade your equipment, it translates to better customer service for everybody who hires your company.

Working capital may be used to hire more skilled employees, invest in top-of-the-line tools and equipment, and complete work more quickly and efficiently to improve the customer experience.

Business Growth

Without working capital, business growth may not be possible. When you obtain small business or equipment financing for your HVAC business, you’ll have the funds and other resources necessary to grow your business.

Since business growth is a goal of every business owner, it stands to reason that this benefit might be the most important of all.

What Are the Downsides of HVAC Business Financing?

We’re big believers in HVAC business financing as a way of fueling business growth, but here are a few potential downsides to consider.

Some Lenders Have Strict Underwriting Requirements

The requirements for small business financing can be quite strict depending on where you go to obtain funding. For example, most banks, credit unions, and the Small Business Administration require personal FICO scores of 650 or higher and may require annual sales of $250,000 or more to qualify.

Collateral May Be Required

Providing collateral is another potential downside depending on where you get your financing. Traditional lenders almost always require collateral for large loan amounts and that may be difficult for some HVAC small business owners to provide.

You May Need to Wait to Get Approved and Funded

The underwriting, approval, and funding process with traditional lenders can be quite time-consuming, requiring small business owners to wait a month or more to get the working capital they need. That delay can be a big downside, but it’s something that may be eliminated by choosing an online or non-traditional lender.

How Does HVAC Financing with Select Funding Work?

We’ve outlined the advantages and disadvantages of small business financing, but you should know that at Select Funding, we’ve created an application and approval process that eliminates the disadvantages of small business financing and makes it easy and quick to obtain.

Qualification Requirements

Let’s start with our qualification requirements, which we’ve limited to just three things:

  1. You must own your own business and have been operating for one year
  2. You must have a minimum of $100,000 in annual sales
  3. You must have a personal FICO score of 525 or higher

That’s it. You don’t need to provide collateral and you don’t need a quarter million or more in annual sales.

Underwriting and Approval

Our underwriting and approval process is designed to be quick and easy. You’ll start by completing our online application and submitting six months’ worth of business bank statements, which we will use to verify your annual sales.

After you have submitted your application, we’ll use our automated system to review it. We can approve you in just a few hours after you’ve submitted your application, which is a much quicker approval than you can expect from a bank or credit union.


Once your application has been approved, the process to get your money is also far quicker than it would be with traditional financing.

Whether you apply for small business financing or equipment financing, you can get your money in as little as 24 hours, so you can begin pursuing your business growth goals.

How Can You Use HVAC Financing to Grow Your Business?

Here are some of the ways that you can use HVAC financing to grow your business:

  • Hire and train new skilled workers. HVAC work is specialized work and it can be difficult to find additional workers if you want to expand your business. Business financing can pay for advertising and onboarding.
  • Purchase or upgrade vehicles. You need business vans to haul your tools and HVAC equipment and parts. You can use equipment financing to buy what you need.
  • Pay for professional certifications and training. Your business and HVAC specialists need the proper training and certifications, which can vary depending on where you’re located. You can use your increased cash flow to pay for these things.
  • Upgrade your tools. You’ll be able to provide the best customer service when you have the best tools to use. Equipment financing can pay for top-of-the-line tools and other equipment for your HVAC business.
  • Expand to a new service area. Business expansion isn’t cheap, but if you get small business financing you can use it to market your services in a new service area, attract new customers, and increase your profits.

You can use small business financing for basic overhead expenses, payroll, hiring, training, and marketing. Equipment financing may be used to purchase or upgrade your tools and equipment, buy new vehicles for your business, invest in HVAC business software, or even to redecorate your office.

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Get the Working Capital You Need to Fuel HVAC Business Growth

HVAC financing is available to small HVAC businesses from Select Funding in amounts up to $250,000 for small business financing and up to $1 million for equipment financing. You can use the money to even out your cash flow and get the working capital you need to expand your business and achieve your most important business goals.

Do you need HVAC financing to grow your business? Select Funding is here to help! Click here to read about our HVAC business financing and begin the application process today.