You've got equipment or vehicles: what they can fund

A ute, a press, a coffee machine or a prime mover has one great advantage as a funding starting point: it’s a physical thing you can describe, photograph and, if it comes to it, sell. Funders who lend against equipment aren’t betting purely on your forecast. They’re also betting on the asset’s second-hand market.

What do funders look at when you offer equipment as the starting point?

Think like the lender, who has to imagine the worst day. If repayments stop, can the asset be repossessed, sold and the debt recovered? That shapes the questions:

• What is it? Common vehicles and mainstream machinery with an active resale market sit at one end. Highly customised or niche equipment sits at the other.
• How old is it, and what is its condition? Age, hours or kilometres, service history and whether it’s been kept under cover all feed in.
• Can it be identified precisely? VIN, serial number and make and model matter, because the funder registers its interest against them.
• Is it already encumbered? The Personal Property Securities Register (PPSR) shows whether another party claims a security interest. The government’s PPSR guidance says goods subject to an unpaid debt could be repossessed even after a buyer has paid, which is why funders and sensible buyers search first.
• Can the business carry the repayments? Even with strong security, most funders still want evidence that your cash flow can service the facility.

How does equipment turn into funding?

There are two routes, and mixing them up causes most of the confusion.

Funding to buy. You’ve found the asset and want to pay for it. The funder pays the supplier, you make repayments, and the asset secures the deal. business.gov.au describes the family of choices: leasing, where the leasing company owns the item and you pay to use it, versus buying with a loan, where you end up owning it and the asset is generally the security.

Funding against what you already own. The asset is paid off or carries real equity. A funder advances cash against it (refinance) or buys it from you and leases it back (sale and leaseback). You keep working with the asset while you free up capital that was parked in steel and rubber.

	Buy with finance	Cash out on an owned asset
Trigger	You need a new or replacement asset	You need working capital, not a new asset
Security	The asset being bought	The asset you already hold
Funder checks	Supplier quote, asset details	Asset inspection or valuation, PPSR search
Typical risk	Asset ages faster than the loan	Over-borrowing against a depreciating asset

What do you need to hand over?

1. For a purchase: the supplier’s quote or invoice, with full asset details.
2. For an owned asset: proof of ownership, registration papers and service history.
3. Your ABN or ACN, director identification and recent bank statements.
4. A short note of other debts secured on your business or on this asset.
5. Photos or access for inspection, if the funder asks.

You can also tell us about the equipment now and we’ll say whether finance, a lease or a cash-out structure looks closest to your case.

What are the trade-offs?

Depreciation works against you. Assets lose value; debt doesn’t automatically shrink at the same pace. Match the repayment term to the useful life of the asset, not to the lowest weekly figure.

Ownership and tax differ by structure. According to business.gov.au, you can usually claim a vehicle as a business asset when you buy with a loan, but not when you lease it. The ATO states that the $20,000 instant asset write-off is permanent from 1 July 2026, applying per asset to businesses with aggregated turnover under $10 million. Whether any of this helps your tax position is a question for your accountant, not a reason to choose a product.

Specialised kit narrows your options. The fewer buyers for the asset, the less a funder will lend against it.

The asset is at risk. In a secured deal, missed repayments can lead to repossession.

Can you finance the whole price, and what else gets rolled in?

Sometimes, and it depends on the asset and your profile. Funders may cover the whole quoted price, or ask for a deposit that lowers their exposure. Extras such as delivery, fit-out, accessories and installation are not always included, so ask whether they can sit inside the facility or must be paid separately. If you are trading in an old asset, its value can reduce the amount you need to borrow, provided any finance on it is settled first.

GST adds a wrinkle. If you are registered for GST, the supplier’s invoice includes it, and you may be able to claim a credit. The cash you need on the day can therefore be larger than the net cost, so confirm with your accountant how the GST on the purchase will flow before you choose the structure.

What should you check in an equipment agreement before signing?

Read these items twice:

• End of term. Do you own the asset, return it, or pay a final amount to keep it?
• Insurance and maintenance duties. Most agreements require you to insure the asset and keep it in working order.
• Early payout. What it costs to clear the agreement before the end.
• Default terms. What triggers repossession and what fees apply.
• Registration. Who registers on the PPSR, and when the registration is removed after the final payment.

Each point affects total cost more than the weekly figure does.

When is equipment finance the wrong tool?

If the problem is a short-term cash gap rather than a purchase, tying up an asset for a multi-year term is a clumsy fix. Look instead at invoice-backed funding or a business line of credit. If you need to fund a large amount against more than one asset, property may carry the whole thing more simply; see property-secured loans.

Is your equipment the right place to start?

Often, if you can name the asset and its details. Tell us what you want to buy or free up, and a person reads your enquiry, thinks about security and cash flow together, and calls you. No credit check to enquire, no pile of lenders receiving your details, and the more accurately you describe the asset, its age and any existing debt, the better the match on the first call. Start the 60-second enquiry.