On used earthmoving machinery, expect a deposit of 0 to 20 per cent and a term of three to five years. The deposit is driven by the machine's age at the end of the term, not today. A ten year old excavator on a five year term finishes at fifteen, and that is what the lender prices.
The short version
- Lenders cap the age of a machine at the end of the term, not at purchase. This single rule explains most declines and most deposit requests on used gear.
- Common caps sit around 15 years at end of term for excavators and earthmoving plant, though this varies by lender and by machine type.
- New machinery from a dealer with trading history behind you is often available with no deposit. Used private sales are the hardest case.
- Private sales are financeable but slower, because the lender must verify title and clear any existing security interest registered against the machine.
- Hours matter as much as years on hydraulic plant. A six year old excavator with 9,000 hours is assessed differently to one with 3,000.
What deposit do you need on an excavator?
There is no single number, but the pattern is consistent.
| Scenario | Typical deposit | Typical term available |
|---|---|---|
| New machine, dealer, 2+ years trading | 0 to 10 per cent | Up to 5 to 7 years |
| Used machine under 5 years, dealer | 0 to 15 per cent | 4 to 5 years |
| Used machine 5 to 10 years, dealer | 10 to 20 per cent | 3 to 5 years |
| Used machine, private sale | 15 to 30 per cent | 3 to 4 years |
| Any machine, business under 12 months | 20 to 30 per cent | 3 to 4 years |
Two variables move you between rows: the age of the machine and how you are buying it. Your own trading history moves you within a row.
Why does the age at end of term matter so much?
Because the lender's security is what the machine is worth if you stop paying, and that value is at its lowest at the point the loan balance is at its highest relative to it.
Most lenders work to a maximum age at the end of the term. If a lender's cap is 15 years, then:
- A three year old machine can go on a five year term without difficulty. It is eight at the end.
- A ten year old machine can go on a five year term, just. It is fifteen at the end.
- A twelve year old machine cannot go on a five year term. It would be seventeen. The lender will offer three years instead, which makes the monthly payment considerably higher.
This is why an older machine feels expensive to finance even when the purchase price is attractive. The price is low and the term is short, and the second of those does more damage to your cash flow than the first does good.
The practical implication when you are shopping: a slightly newer machine at a higher price can produce a lower monthly payment than an older, cheaper one, because it unlocks a longer term. Run both before assuming the cheap one is cheaper.
Do hours matter more than years?
On hydraulic plant, often yes.
An excavator's value is driven by the condition of the hydraulics, undercarriage and engine, and hours are the better proxy for all three. A machine that has done light residential work at 400 hours a year is a different asset to one that has been on a civil site at 1,800 hours a year, even if they were built in the same month.
Lenders and their valuers know this. What it means for you:
- Low-hour older machines can be financed on better terms than the calendar age suggests, particularly with a recent service history.
- High-hour newer machines can attract a larger deposit than you expect.
- Undercarriage condition on tracked machines is worth documenting. It is one of the largest single repair costs and valuers look for it.
Bring the service history and the hour meter reading to the finance conversation. It is the cheapest way to improve your terms.
Private sale or dealer: what changes?
Both are financeable. The difference is process and risk.
A dealer purchase is clean. The dealer holds clear title, provides a tax invoice, handles the GST, and the lender pays the dealer directly. Settlement is usually fast.
A private sale requires the lender to do work the dealer would otherwise have done:
- Verify the seller actually owns the machine.
- Check the Personal Property Securities Register for existing security interests. Machinery under finance to another lender is common, and that interest must be discharged at settlement.
- Arrange an inspection or valuation, which is more often required than on a dealer purchase.
- Handle settlement so the existing financier is paid out and the title transfers cleanly.
Expect a private sale to take longer and to attract a higher deposit. It is not a reason to avoid private sales, which are often where the value is. It is a reason to start the finance conversation before you shake hands rather than after.
Which structure suits earthmoving plant?
For most contractors, a chattel mortgage. You own the machine, the financier holds security, and there is no residual to deal with at the end.
The argument for a finance lease with a residual is lower monthly payments during the term. On earthmoving plant that argument deserves scrutiny, because you are betting on the machine's value in four or five years, and that market moves with the construction cycle. If you set a $60,000 residual on a machine that is worth $40,000 when the mining or infrastructure cycle turns, the gap is yours to fund.
Rental has a genuine place for contractors: a specific project, a machine class you use twice a year, or trialling a size you have not run before. Owning a machine that sits idle nine months of the year is a common and expensive mistake in this industry.
See our comparison of the four equipment finance structures for how they differ on ownership and end of term.
What else gets financed alongside the machine?
Attachments are frequently the difference between a machine that earns and one that does not, and they are financeable.
Buckets, hydraulic hammers, augers, grapples, tilt hitches and mulching heads can typically be included on the same facility if they are on the same invoice. A hydraulic hammer alone can be $8,000 to $30,000 depending on carrier size, which is not a rounding error.
Float and transport is harder. If you need a truck and trailer to move the machine, that is a separate asset with its own finance, and it should be planned as part of the same capital decision rather than discovered afterwards.
Frequently asked questions
How old can an excavator be to get finance in Australia?
Most lenders work to a maximum age at the end of the loan term rather than at purchase, commonly around 15 years for earthmoving plant. A twelve year old machine is financeable, but usually only over a shorter term.
Can I finance an excavator bought privately?
Yes. The lender will verify the seller's title, check the Personal Property Securities Register for existing security interests, and often require an inspection. Expect a higher deposit and a slower settlement than a dealer purchase.
What deposit do I need for earthmoving equipment finance?
New machinery from a dealer with two years of trading behind you is often available with no deposit. Used machinery typically attracts 10 to 20 per cent, and private sales of older machines can require more.
Do machine hours affect finance approval?
Yes, particularly on hydraulic plant. Hours are a better indicator of remaining life than calendar age, so a low-hour older machine with service history can be financed on better terms than its age alone would suggest.
Can attachments be financed with the machine?
Generally yes, where they appear on the same supplier invoice. Buckets, hammers, augers and hitches are routinely included in the same facility.
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