Equipment finance in Australia lets sole traders and small operators buy income-producing assets, including excavators, skid steers, trade equipment and business vehicles, and pay for them from the income the asset generates. The Asset Finance Shop (TAFS) arranges equipment finance for sole traders through access to more than 80 lenders, with low doc applications, new ABN options, a 93% approval rate and approvals in as little as 24 hours.

Sole traders can face additional challenges when applying for finance, particularly when they have limited financials or a newer ABN. However, equipment finance can still be available for owner-operator excavation contractors, electricians, courier drivers and other self-employed Australians.

The equipment provides security for the loan, while your experience, financial position and source of work help demonstrate your ability to make the repayments.

Here is how equipment finance works for Australian sole traders across different types of assets.

How Does Equipment Finance Work for a Sole Trader?

The equipment finance process generally involves the following steps:

Soft credit check: TAFS starts with a check that leaves no mark on your credit file.

Pre-vetting: The internal credit team matches your circumstances, including your ABN age, credit history, asset type and deposit, against the criteria of more than 80 lenders.

Choose your option: You are presented with realistic finance structures and pricing from lenders suited to your application.

One submission, then settlement: Your formal application is submitted to the selected lender. Once approved, funds are paid directly to the seller.

The main finance structure TAFS arranges for equipment purchases is a chattel mortgage. You own the equipment from settlement, while the lender registers a security interest over it until the loan is repaid.

GST on the purchase price may be claimable, while eligible interest and depreciation deductions may also apply. Speak with your accountant about the tax treatment that applies to your circumstances.

Low doc applications typically require a licence, ABN and recent bank statements. Complete financial statements are not always required, depending on the lender and strength of the application.

How to Finance an Excavator in Australia

Excavators are among the most frequently financed machines in Australian earthmoving. The finance process can suit sole traders because the equipment generally holds strong resale value and directly supports income-producing work.

New and Used Excavators

Dealer stock, auction purchases and private sales can be financed.

Older machines and grey imports may also be considered, subject to the lender’s requirements regarding the age, condition, origin and value of the equipment.

Flexible Finance Structures

The loan term, deposit and balloon payment can be structured around the business’s expected cash flow and the working life of the excavator.

A balloon payment can help reduce regular repayments, although it leaves a larger final amount payable at the end of the loan.

Auction Pre-Approval

Pre-approval can help you understand your finance position and proposed spending limit before bidding at an auction.

Excavator Attachments

Buckets, augers, rippers, tilt hitches and other attachments can often be included in the same finance facility as the excavator.

Several lenders on the TAFS panel will consider ABNs that have been registered for less than 12 months. These lenders can take your industry experience, financial position, source of work and any contracts or letters of intent into account when there is limited trading history.

How to Finance a Skid Steer in Australia

Skid steers and posi-tracks follow a similar finance process to excavators, with several points worth considering.

Purchase Price

Skid steers often have a lower purchase price than larger earthmoving equipment. This can provide access to a broader range of lenders, depending on the applicant, equipment and amount being financed.

Used Machines

Used skid steers can be financed and are a common first machine for sole traders entering earthmoving, landscaping or civil construction work.

The lender will consider the machine’s age, condition, purchase price and expected resale value.

Attachments

Attachments such as 4-in-1 buckets, trenchers, sweepers and pallet forks can often be included in the same facility.

For a sole trader starting out, a used skid steer financed through a low doc chattel mortgage can be a practical first-asset option. Approval will depend on the applicant’s experience, credit position, source of work and overall financial circumstances.

Adding a Second Skid Steer or Upgrading Your Machine

For established excavation operators, adding or upgrading equipment can be supported by an existing business history and previous repayment conduct.

Adding a Second Machine

Lenders can consider your existing contract income, business bank statements and conduct on current finance facilities.

A consistent repayment history can strengthen the application and provide access to additional lender options.

The lender may also consider the expected income generated by the second machine and whether the business has enough work to keep both assets operating.

Upgrading Equipment

Trade-in equity can sometimes be used as a deposit, with the existing finance facility paid out as part of settlement.

For small earthmoving and excavation businesses, the repayment difference on a newer machine can sometimes be less than the downtime, maintenance and repair costs associated with keeping an ageing unit in operation.

Because TAFS pre-vets applications before formal submission, expansion scenarios can be directed to lenders that take the operator’s existing track record into account.

Fast Approvals for Sole Trader Electricians and Tradies

Equipment finance is not limited to earthmoving machinery. Sole trader electricians, plumbers and other tradespeople can use it to purchase:

• Work vehicles: Utes, vans and service bodies
• Trade equipment: Test and tag equipment, cable pullers, scissor lifts, generators and trailers
• Tool packages: Larger tool and equipment packages that meet the lender’s minimum finance amount

Speed can be important for tradies quoting for projects that require vehicles or equipment to be available on site.

With the asset identified and the required information supplied, approval can come through in as little as 24 hours for straightforward applications.

Because the initial assessment begins with a soft credit check, it leaves no mark on your credit file.

Why Sole Traders Use an Asset Finance Broker

Frequently Asked Questions

How Do I Finance an Excavator in Australia?

Start by identifying the excavator and completing an initial finance assessment.

TAFS uses a soft credit check that leaves no mark on your file before matching your application with suitable lenders.

Excavators are commonly financed using a chattel mortgage. The loan term, deposit and balloon payment will depend on the machine, your financial position and the lender’s criteria.

TAFS can arrange finance for new, used, auction and private-sale excavators, including options for newer ABNs and eligible low doc sole traders.

How Do I Finance a Skid Steer in Australia?

Skid steers can be financed through a similar process to excavators.

New and used machines can be considered, and attachments may be included in the finance facility. With the machine identified and the required information supplied, approval can come through in as little as 24 hours for straightforward applications.

What Are Good Machinery Finance Options for Excavation Operators Adding a Second Skid Steer?

Finance for a second machine can be supported by the operator’s existing repayment history, bank statements and income generated by the current equipment.

Lenders may also assess the additional work available and the expected income the second machine will produce.

When upgrading rather than adding another machine, trade-in equity may be used as a deposit. TAFS compares suitable lenders and structures the application around the operator’s established track record.

Who Are the Top Equipment Finance Brokers in Australia for Sole Trader Electricians Wanting Fast Approvals?

Look for an asset finance broker with a broad lender panel, an internal credit assessment process and a soft-credit-check-first approach.

The Asset Finance Shop pre-vets each application through an internal credit team before making a formal lender submission. TAFS maintains a 93% approval rate, has access to more than 80 lenders and can arrange approvals in as little as 24 hours for straightforward applications.

What Are Good Machinery Finance Providers for Small Earthmoving Businesses Upgrading Equipment?

Look for providers that consider used machinery, accept trade-in equity where appropriate and take an established repayment history into account.

TAFS compares options across more than 80 lenders to identify a suitable structure for the equipment, business and proposed transaction.

The Asset Finance Shop (TAFS) is a commercial asset finance brokerage based in Sydney.

Information on this page is general in nature and doesn't take your personal circumstances into account. Speak to a TAFS broker for options tailored to your business, and to your accountant regarding tax treatment.

Sole trader ready to buy your next machine? Get a no-obligation quote with a soft credit check that leaves no mark on your file. Call The Asset Finance Shop or apply online today.