Buying equipment for your business is a big investment and the right finance can make all the difference. Whether you’re after a lease or a loan, there’s a wide range of commercial finance options to help you access the machinery, vehicles or technology you need. Our experienced equipment finance brokers work with some of Australia’s top lenders to secure competitive finance deals that work for you.
Why apply for a business loan with Savvy?
Types of equipment loans
When financing equipment for your business through Savvy, you typically have two main options:
- Loan (chattel mortgage)
With a chattel mortgage [link https://savvy.com.au/business-loans/chattel-mortgage/], a lender provides the funds to purchase your equipment, with the asset used as collateral for the loan. You have immediate ownership and access to the equipment and you repay the loan over a set period, usually from one to seven years. Because the loan is secured, the lender may repossess the equipment if your business cannot meet its repayment obligations.
- Lease
Leasing allows you to use the equipment while spreading the cost over time, with options tailored to how you intend to use the asset:
- Finance lease: under a finance lease, the lender retains legal ownership of the equipment throughout the lease term – usually from one to five years – while your business leases it for a fixed period at a fixed monthly cost. You’re responsible for all maintenance and operating costs. At the end of the term, you may have the option to purchase the asset for an additional amount, or you can return it.
- Operating lease: this is a shorter-term rental arrangement where you don’t take ownership of the equipment. Instead, you rent it for a set period, and the lender (or lessor) usually covers maintenance and servicing costs. Once the operating lease ends, you simply return the equipment with no further obligations.
Business lenders you can compare
What kind of equipment can I finance?
You can finance a broad range of equipment to support and perform business operations. This includes plant – larger, fixed machinery and equipment commonly used in industrial or trade settings – smaller equipment and business vehicles, including:
- Heavy machinery: industrial machines, heavy plant equipment, forklifts, prime movers
- Smaller equipment: portable power tools, hand tools
- Vehicles: cars, vans, utes, trucks, trailers, buses
- Construction equipment: bulldozers, cranes, frannas, excavators
- Agricultural equipment: tractors, harvesters, planters
- Restaurant equipment: furniture, ovens, fridges, freezers, dishwashers.
- Retail equipment: shop fitout, IT, POS systems
What influences the cost of equipment finance?
Asset type and condition
The type, value and age of your equipment all play a role in your finance deal. Newer equipment often attracts lower rates, as it depreciates more slowly and has a higher resale value, which reduces the lender’s risk. Furthermore, some items will depreciate a lot faster than others – for example, computer equipment generally needs replacing every few years while some heavy-duty manufacturing and construction equipment can last for decades – which can impact the rate you’re offered.
Your business finances
Your business’s financial position plays a key role in determining the cost of finance. Lenders will assess factors such as turnover, profit, liabilities and years in operation. Well-established businesses with strong cash flow and low debt levels are considered lower risk, and may qualify for better rates and terms. Your business credit score, as well as the creditworthiness of directors or guarantors, can also affect loan approval and pricing.
Interest rates
Interest rates on equipment finance are typically lower than unsecured loans, as the asset secures the financing. Rates can be either fixed, providing stable payments, or variable, which may fluctuate. The interest rate type can influence how much you pay over time.
Balloon or residual payments
With both finance leases and chattel mortgages, you may be able to choose a balloon or residual payment at the end of the term. These payments reduce your monthly costs but leave a final, larger amount to settle. This structure helps make repayments more manageable but requires planning for the final lump sum.
Fees
As with other types of finance, equipment finance typically comes with additional fees, such as establishment fees when setting up the loan, which cover administrative costs, early termination fees if you end the lease or loan early and valuation fees if the asset needs to be valued. However, the fees that apply vary depending on the terms and lender policies.
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Equipment finance vs lease
Choosing between a loan and lease depends on your business’s priorities, cash flow and how long you plan to use the equipment. Here’s how they compare:
| Feature | Chattel mortgage | Finance lease | Operating lease |
|---|---|---|---|
| Ownership | You own the equipment from day one | Lender owns the equipment during term | Lender owns the equipment throughout |
| Upfront cost | Higher – often requires a deposit | Lower – minimal upfront cost | Lower – rental-style payments |
| Repayments | Fixed loan repayments (balloon optional) | Fixed lease payments | Fixed lease payments |
| Balloon/residual option | Optional balloon at end to reduce repayments | Residual value due at lease end | Not applicable |
| Maintenance responsibility | Your business | Your business | Usually the lessor |
| Flexibility | Less flexible – difficult to upgrade | Can upgrade at end of term | Easy to upgrade or switch |
| Customisation | Equipment can be modified | Typically no modifications allowed | No modifications allowed |
| Tax treatment | Interest and depreciation may be tax-deductible | Lease payments may be deductible | Lease payments may be deductible |
How much will my equipment finance cost?
The cost of equipment finance can vary significantly depending on the type of asset you’re buying. There’s no typical figure that applies across the board because equipment types, prices and rates differ so much, which can make it difficult to compare costs.
For example, a used Bobcat skid steer loader might cost $25,000, while a new crane could be $500,000. With an 8% p.a. interest rate, the monthly repayments between the two on a five-year loan term would be $504 and $10,072 respectively.
You can use our equipment finance calculator to see what your repayments could look like based on the loan amount, term and interest rate.
Crunch the numbers
with our business loan repayment calculator
Your estimated repayments
$98.62
| Total interest paid: | Total amount to pay: |
| $1233.43 | $5,143.99 |
Equipment loan eligibility and documentation
Eligibility
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Age
You must be at least 18 years of age
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Residency
You must be an Australian citizen or permanent resident (or, in some cases, an eligible visa holder)
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ABN registration
Have an ABN registered in your name (available from as soon as one day after registration)
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Usage
Meet commercial asset usage requirements (at least 51% of total usage)
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Credit score
You must meet your lender’s minimum personal and business credit score requirements
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Commercial asset
The asset you choose to buy must meet your lender’s requirements in relation to its type, age and condition
Documents
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Personal information
Such as your full name, date of birth, address and contact details
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Driver's licence
Front and back (or another form of government-issued ID)
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Assets and liabilities
Information about your business’ assets and liabilities, as well as those in your name
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Asset details
Information about your asset, including its model and age, is worthwhile having on hand
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Business statements
Business Activity Statements (BAS) and business bank statements may be requested, but not always
How to apply for equipment finance
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Complete Savvy’s online form
Start by filling out our easy online application. Let us know how much you need to borrow and key details about your business such as its name, ABN, size and annual turnover along with your personal information.
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Upload your documents
To support your application, you’ll need to supply a variety of documents, which lenders will use to assess your business’ capacity to service the loan.
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We'll assess your profile
Once we’ve reviewed your application, our team of brokers will compare offers from a panel of trusted lenders to find suitable options for your needs. Given the variables with equipment finance, we’ll contact you to walk through your choices and explain the terms. -
Finalise your application
When you’re ready, we’ll help you complete the application and submit it to the lender. If everything checks out, you may receive formal approval within 24–48 hours. -
Sign the contract and access your funds
Once approved, you’ll sign the loan agreement. Your Savvy broker will coordinate the settlement and arrange for the funds to be paid directly to the supplier, or to you, depending on the lender’s process.
