How equipment finance can help your business grow

For many businesses, equipment is what earns the money: a ute, an excavator, a coffee machine, a tractor. Equipment finance lets you spread the cost of that asset over a set term instead of paying for it all upfront.

How it works

The lender usually takes the equipment as security for the loan. Because the loan is backed by an asset, it can sometimes be cheaper or easier to get than unsecured borrowing, though that depends on the lender, the asset and your circumstances. Common structures include a chattel mortgage, hire purchase and leasing. Each treats ownership, end-of-term payments and tax differently.

Why businesses use it

• Keep cash in the business. Your working capital stays available for wages, stock, tax and the unexpected.
• Match the payments to the income. The equipment can help pay for itself while you use it to earn.
• Get working sooner. You can buy what you need now rather than waiting until you've saved the full amount.
• Build on a good record. Lenders look at how you've managed existing finance, so a well-managed facility can support future applications.

What to check before you sign

• The total cost of the loan, including fees and any final (balloon) payment, not just the repayment.
• Whether the term is longer than you'll actually use the asset for.
• Running costs such as insurance, registration and maintenance.
• Whether you are buying from a dealer or privately. Private sales usually need extra checks, so see our Private Sale Guide.
• The tax treatment. This depends on your structure and the type of finance, so speak to your accountant.

Next step

Use our chattel mortgage calculator to estimate repayments, then send an enquiry and we'll talk through your options.

Send an enquiry