Equipment finance · Earthmoving and construction plant
Finance for an excavator.
An excavator is bought against work, not against wishes. The machine that suits the jobs you are winning today is often a size smaller and several years older than the one in the brochure. Here is how these deals are put together, what the float and the attachments do to the number, and why the repayment schedule matters more than the machine on contract work.
Start here
Buy for the work you have won, not the work you hope for.
The most expensive mistake in earthmoving is not paying too much for a machine. It is buying a class larger than the jobs on your board, on the reasoning that bigger contracts will follow once the machine is in the yard. Sometimes they do. Often the machine spends its first year doing work a smaller excavator would have done more cheaply, while carrying a repayment sized for work that has not arrived.
The classes below are the broad way the industry talks about size. They are rough bands rather than standards, and manufacturers straddle them, but they are a useful way to think about reach, lift and how much trouble a machine is to move.
| Class | Where it earns | Getting it to site | Worth thinking about |
|---|---|---|---|
| Mini around 1 to 2 tonne |
Residential trenching, pool access, landscaping, plumbing and irrigation — anything that has to fit through a side gate. | Towable behind a suitable vehicle on a plant trailer, which is why it is often the first machine an operator owns. | Cheapest to own and move, and the easiest to keep busy. Runs out of reach and lift quickly if your work is drifting toward civil. |
| Compact around 3 to 5 tonne |
The workhorse band. Footings, driveways, drainage, small subdivision work, tight urban blocks. | Usually a tandem or tag trailer behind a capable tow vehicle, or a light truck. | The deepest second-hand market of any class, which cuts both ways: plenty of choice, plenty of tired machines dressed up well. |
| Mid-size around 5 to 8 tonne |
Bulk earthworks on residential sites, larger drainage runs, rural dam and track work, demolition support. | Realistically a truck and float, or a tilt tray operator on call. Transport stops being an afterthought here. | Usually where the second financing decision appears, because the machine can no longer be towed behind what you already own. |
| Larger tracked roughly 13 tonne and up |
Civil contracts, subdivision bulk earthworks, quarry and pipeline work, sustained production digging. | A dedicated float, or a contractor for every move. Moves become a scheduled cost, not a convenience. | Only stacks up against contracted volume. Idle time here is expensive in a way it simply is not on a mini. |
Look at the jobs you actually invoiced over the last twelve months, not the tenders you are chasing. If the machine you are considering would have been the right tool on most of them, it is probably the right buy. If it would have been overkill on all but two, the honest move is usually the smaller class, a modest repayment, and hiring in the bigger machine on the days you truly need it.
The assessment
What an equipment lender is weighing up.
The business behind the machine
How long you have been trading and under what structure, whether the ABN and GST registration are established, and what other equipment commitments already exist. Newer businesses are financed all the time — the evidence required is simply different, and leans harder on the director's own position.
The machine itself
Age, hours, make, condition and how readily it would resell. The excavator is the security, so a well-known model with a real service history and a healthy second-hand market is easier to place than an orphan import nobody wants to buy back.
Where the work comes from
Whether income is one head contractor or several, whether it is contract, hourly hire or your own jobs, and how steady it has been. Lenders are not looking for perfection here. They are looking for evidence that the repayment survives a quiet month.
The parts people underestimate
The float, the hour meter and the attachments.
Moving it is a second financing decision
Once you get past the small end of the market, an excavator cannot get to site on its own. That leaves three honest options: pay a transport operator every time the machine moves, tow it yourself on a plant trailer behind a vehicle rated to do so, or buy a truck and float and carry it yourself.
Only one of those is free of a second finance application. Towing your own machine means the combined weight of trailer and excavator has to sit inside the tow vehicle's rated capacity and your licence class — a question for the compliance plate and your state's transport authority rather than a finance broker, and worth resolving before you sign anything. Buying a truck and float means a second asset, a second application and a second repayment, which we would rather structure alongside the machine than bolt on three months later.
Hired transport is the option most people dismiss too quickly. If the machine moves once a fortnight, paying an operator usually beats owning a truck that sits idle. If it moves three times a week, the arithmetic flips. Count your actual moves before deciding.
Hours are the odometer
On a used machine, the hour meter tells you more than the year of manufacture. Two identical excavators built the same year can be worlds apart if one has spent its life on light residential work and the other has been on a rock breaker in a quarry. Hours drive the wear on the undercarriage, the pins and bushes, the hydraulics and the engine, and they drive resale value in a way that model year alone does not.
For finance, hours and age together shape what a financier is comfortable with and how long a term the asset will support. We will not put a number on that here — it varies by lender, by machine and by your own position, and any figure we invented would be misleading. What is safe to say is that a high-hour machine is not automatically unfinanceable, but it narrows the field, and the narrower the field the more the rest of your application has to carry.
Hour meters can be replaced, and a suspiciously low reading on a visibly tired machine is worth asking about. Service records, a pre-purchase inspection by someone who knows the make, and a PPSR search confirming nothing is owed are all cheap next to a bad buy. Buying privately, do all three. We would rather delay an application by a week than fund a machine you will regret.
Attachments: inside or outside the loan
Few excavators earn their keep on one bucket. A working kit usually means a general purpose bucket, a trenching bucket, a quick hitch, and then the things that open up new work: an auger for post holes and piers, a hammer for concrete and rock, sometimes a grab, ripper or compaction wheel.
Attachments can generally sit inside the financed amount when they are bought with the machine and appear on the same invoice, because they become part of the asset being funded. Buying them separately later usually means paying cash or arranging a second facility, and small standalone amounts are among the least efficient things to finance.
The trade-off is worth stating plainly. Rolling attachments into the loan spreads a real cost over the full term: easier on cash flow now, more expensive over the life of the deal. Buying the essentials upfront and adding the specialist gear out of earnings keeps the borrowed amount down. Which is right depends on whether the attachment wins you work immediately or sits on the rack waiting.
Compare
Chattel mortgage, lease or rental.
Business equipment is usually funded under one of three structures. They differ in who owns the machine, what happens at the end, and how the payments are treated in your books. The mechanics below are general and factual. The tax and accounting treatment is genuinely your accountant's call, not ours.
| Structure | Who owns the machine | At the end | Where it tends to suit |
|---|---|---|---|
| Chattel mortgage | You do, from settlement. The financier registers its interest over the machine on the PPSR as security. | You own it clear once the contract is paid out. A balloon or residual can be set, which lowers the regular payment and leaves a lump sum due at the end. | The most common structure for owner-operators who intend to keep the machine long term and want it on their own balance sheet. |
| Finance lease | The financier owns the machine and leases it to you for the term. | A residual is payable. Depending on the agreement you may purchase, refinance the residual, or hand the machine back. | Businesses that want a defined end point and are comfortable with the financier holding title through the term. |
| Rental or operating rental | The rental company owns it throughout. You are paying for use, not for ownership. | Return it, extend, or negotiate a purchase depending on the agreement. | Shorter commitments, machines needed for a specific contract, or where you would rather not carry the asset at all. |
How each is treated for GST, depreciation and deductions depends on your business structure, your turnover, how the machine is used and the rules in force at the time. We are credit brokers, not tax advisers. We will explain how each structure works commercially and what it does to your repayment, then talk to your accountant directly so the finance and the tax position are decided together rather than in sequence.
The honest bit
The repayment does not pause between jobs.
Contract earthmoving income is lumpy in a way that finance contracts are not. A wet fortnight, a delayed development approval, a head contractor who pays on sixty days, a machine waiting on a part — none of that changes what comes out of the account on the due date.
This is the single most common reason a good operator ends up in trouble on an otherwise sensible machine. The purchase decision gets modelled on a busy month, and the quiet months are treated as an exception rather than a normal part of the year.
A few things genuinely help:
- Size the repayment against your quiet months. If it only works when everything is running and everyone pays on time, it is too tight. The number should survive a slow six weeks.
- Choose the term deliberately. A longer term lowers the monthly commitment and costs more in total. On a machine that will still be earning years from now, that trade often buys worthwhile breathing room; on a tired machine you expect to replace sooner, it usually does not.
- Understand a balloon before you accept one. A residual makes the regular payment smaller and leaves a real amount owing at the end. Fine if you have a plan for it — trade, refinance or pay it out. A problem if it arrives as a surprise on a machine now worth less than the lump sum.
- Leave room for running costs. Fuel, undercarriage, ground engaging tools, servicing, insurance and the occasional hydraulic repair are not small, and they do not wait for a good month either.
None of that is a reason to avoid borrowing. Equipment finance is how most earthmoving businesses are built. It is a reason to build the structure around how the income actually arrives.
How it works
Three steps.
Tell us the machine and the work
Make, model, year, hours, price, and whether it is a dealer or a private seller. Then what matters just as much: what the machine will be doing and who pays for it.
We check policy before lodging
We match the machine and your business to the financiers whose criteria actually fit, rather than testing your credit file to find out. If the machine is the problem, you hear it before you commit.
Approval, then settlement
We handle the paperwork, the PPSR checks and payment to the seller, including the extra steps a private sale needs. One broker throughout.
Common questions
Excavator finance, answered.
Can I finance a used excavator, and do hours matter?
Used machines are financed routinely — most of this market is second-hand. Hours matter because they are the closest thing a machine has to an odometer, and they drive both condition and resale value. Age and hours together influence which financiers will look at the deal and what term the asset will support. There is no single cut-off we can quote you: it differs by lender and by machine, and a specific figure would be a guess dressed up as policy.
Can attachments be included in the loan?
Generally yes, when they are bought with the machine and appear on the same invoice — buckets, a quick hitch, an auger or a hammer become part of the asset being financed. Adding them later is harder, because a small standalone amount is an awkward thing to finance on its own. If you know you will need a breaker or an auger within the first year, it is usually worth having that conversation at the start rather than after settlement.
Do I need a truck or trailer as well?
It depends entirely on the size of the machine and how often it moves. A mini can often be towed behind a suitably rated vehicle on a plant trailer. From the mid-size class up, you are looking at either a transport operator or your own truck and float. Buying the transport is a separate finance decision with its own repayment, so it is worth counting your actual site moves first — infrequent moves usually favour hired transport by a wide margin.
Chattel mortgage or lease — which should I choose?
Commercially, the main difference is ownership. Under a chattel mortgage the machine is yours from settlement with the financier's interest registered against it; under a lease the financier holds title and a residual falls due at the end. Which one suits you also depends on tax and accounting treatment, and that is a decision for your accountant rather than for us. We will explain what each structure does to your repayment and your end position, and we are happy to talk it through with your accountant so both sides of the decision are made together.
I am a new business or an ABN with a short history. Is that a problem?
It narrows the options rather than closing the door. Newer businesses are financed regularly in this industry, though the evidence required is different — the director's own credit conduct, any deposit or trade-in, property ownership and demonstrable experience in the trade all carry more weight when there is limited trading history to read. Being upfront about it lets us take the application somewhere it has a genuine chance.
Can I buy privately, or does it have to be from a dealer?
Both happen constantly in earthmoving, and plenty of the best-value machines are private sales. A private purchase involves a few extra steps: a PPSR search confirming nothing is owed on the machine, verifying the seller and the machine's identification, and handling payment properly rather than by handshake. Not every financier funds private sales, so it is worth telling us how you intend to buy before you put a deposit down.
What happens if work dries up for a few months?
The repayment continues, which is exactly why the structure should be built around uneven income rather than a good month. If you can see a rough patch coming, speak to the financier early — hardship provisions exist and are far more useful before a payment is missed than after. Talk to us too. Sometimes a restructure is available, and it is always a better conversation to have early than once arrears have been recorded on your file.
Will applying affect my credit file?
Talking to us does not. We assess the machine and your position against lender policy before anything is formally lodged, so no enquiry is recorded while we work out where the deal fits. That matters more in equipment finance than people expect, because applying directly to several financiers and being declined each time leaves a trail that makes the next application harder — often at exactly the moment you have a machine on hold and a seller waiting.
Let's talk
Send us the machine before you send the deposit.
No cost, no obligation, and no credit enquiry while we work it out. Tell us the machine, the hours and where the work comes from, and we will tell you what can realistically be arranged — including the times when the honest answer is that a smaller machine would serve you better.
The Finance Team is a trading name of Online Showroom Pty Ltd, holder of Australian Credit Licence 551493. We act as a credit broker rather than a lender, so nothing on this page is an offer of credit. Any amount, term or repayment discussed with you is an estimate for illustration only, and every application is subject to assessment and approval by the financier. Tax and accounting treatment is a matter for your own accountant.
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