Equipment financing
Used Equipment Financing: How to Finance Pre-Owned Trucks, Machinery and Tools
Used equipment costs 30 to 60 percent less than new and finances almost as easily — with a few rules about age, value and who you buy it from. Here is how lenders treat pre-owned equipment, dealer vs private sale, and what to check before you sign.
Can You Finance Used Equipment?
Yes. Most equipment lenders finance used trucks, trailers, construction and farm machinery, manufacturing equipment and shop tools, typically up to 10 to 15 years old at the end of the term (newer for technology), from dealers, auctions or verified private sellers. Expect terms of 24 to 60 months instead of up to 84, an advance rate of 75 to 100% of the lower of price or verified value, an inspection or appraisal on private-party and higher-value deals, and rates about one to three points above new-equipment pricing. Section 179 and bonus depreciation apply to used equipment as long as it is new to you.
How Lenders Treat Used Equipment
| Factor | New | Used |
|---|---|---|
| Maximum age at end of term | n/a | 10–15 years (trucks, machinery); 3–5 years (technology) |
| Term | Up to 84 months | 24–60 months, tied to remaining life |
| Advance rate | Up to 100% of invoice | 75–100% of the lower of price or verified value |
| Valuation | Invoice | Auction and dealer guides; inspection or appraisal on private sales and larger tickets |
| Rate | Base | Base plus 1–3 points |
| Seller | Dealer | Dealer, auction, or private party with bill of sale and clear title |
Dealer vs Private-Party Purchase
- Dealer: fastest and simplest. The lender pays the dealer against an invoice; title and lien are handled routinely.
- Auction: financed by most lenders with the auction invoice; have the approval in hand before you bid.
- Private party: financed by many but not all lenders. Expect a bill of sale, a lien search and title verification, a third-party inspection, and sometimes an escrow or a check made out jointly to the seller and lienholder.
How Value Is Set
Lenders will not finance more than the equipment is worth. On trucks and heavy equipment they use auction results and dealer guides; on machinery, a desktop or on-site appraisal above roughly $75,000–$100,000. If the price is above the verified value, the difference is your down payment. Bring the serial number or VIN, hours or mileage, photos and the maintenance history to the application; it shortens the valuation.
What to Check Before You Sign
- Clear title and no existing liens (a UCC search on the seller; a title check on vehicles).
- Hours, mileage and condition match the listing; get an inspection on anything over $50,000.
- Parts and service availability for the brand and model.
- Remaining useful life exceeds the loan term by a comfortable margin.
- Insurance is available at a sensible premium; the lender will be named loss payee.
Taxes on Used Equipment
Section 179 and 100% bonus depreciation both apply to used equipment, provided it is new to your business and not bought from a related party. A $60,000 used excavator bought and placed in service in 2026 can be fully expensed in 2026 whether you paid cash or financed it. See Section 179 and equipment financing.
Who Finances Used Equipment Well
Independent equipment lenders and asset-based programs are the natural home for used deals, especially trucks, trailers and construction equipment, and several accept B/C credit and start-ups on the strength of the asset. Banks prefer late-model dealer units. RAN Funding routes used-equipment files to lenders that specialize in the asset class. Requirements: equipment financing requirements; credit under 600: equipment financing with bad credit.
Common Questions
How old can equipment be to finance it?
Typically up to 10 to 15 years old at the end of the loan term for trucks and machinery, and 3 to 5 years for computers and technology. Older equipment with strong value can sometimes be financed on shorter terms with a larger down payment.
Can I finance equipment from a private seller?
Yes, with many lenders. Expect a bill of sale, a lien and title check, an inspection, and payment handled so the seller is paid and any existing lien is cleared at the same time.
Do used equipment loans have higher rates?
Usually one to three points higher than new, with shorter terms, because resale value is lower and less certain.
Does Section 179 apply to used equipment?
Yes, as long as the equipment is new to your business and not bought from a related party. 100% bonus depreciation also applies to used property.
Sources
- How equipment financing works: 2026 guide — Crestmont Capital
- Section 179 deduction guide 2026 — Block Advisors
See What You Qualify For
One application, about five minutes, soft pull only. A funding specialist tells you up front whether SBA is realistic for your file — and which faster products fit if it is not.
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