For tradies, cafes, transport operators and retailers, equipment is the business. Financing it rather than paying cash keeps working capital free for wages, stock and growth.
The main structures
| Structure | Who owns it | Often suits |
|---|---|---|
| Chattel mortgage | You, from day one | Vehicles and equipment for GST-registered businesses |
| Finance lease | The financier, you rent it | Businesses wanting off-balance-sheet options |
| Hire purchase | The financier until the final payment | Businesses paying over time toward ownership |
Tax and GST treatment differs between them, so check with your accountant before choosing.
Balloon payments
A balloon (residual) is a lump sum due at the end. It lowers regular repayments but you'll need to pay, refinance or trade in at the end of the term.
What lenders need
- ABN and GST registration details.
- Supplier invoice or quote.
- Recent BAS or financials for larger amounts or newer businesses.
Learn more on our equipment finance page, or read about business finance for working capital and expansion.
New vs used equipment
Most lenders finance both new and used assets, but terms can be shorter for older equipment and some lenders limit the age of the asset at the end of the loan. Private sales are possible with some lenders, with extra checks on ownership and any existing finance.
How long should the term be?
Match the term to the useful life of the asset. Financing a laptop over five years or a truck over two years both create problems: paying for something you've replaced, or repayments your cash flow can't carry.
Low-doc options
Established businesses can often finance vehicles and equipment up to certain limits with minimal paperwork, typically an ABN held for a minimum period and a clean credit history. Larger amounts need financials.
Also funding a fit-out or premises? See commercial property loans and our commercial property finance guide.
Get a quote on your next vehicle or equipment
Free, no-obligation chat with Ram Lakshmanan. No credit check to start.