Quick answer
An equipment loan lets a tradie buy tools or machinery and repay over time while the kit earns. Unsecured business options typically run from $5k to $500k, sized on turnover and bank statements, and property-secured loans run from $20k to $5m. It is for business use only, and your first enquiry involves no credit check.
Key points
- A loan means you own the equipment and repay as it works
- Size depends on turnover, bank statements and the asset itself
- A deposit or extra security can widen the options
- Plan for insurance, servicing and downtime on top of repayments
- No credit check when you first enquire
Most tradies buy equipment in one of two moods. Either the old gear has finally died and the purchase is urgent, or a bigger job has appeared and the kit has to be there before the first day. Both are bad moments to be reaching into the operating account, because that account is also paying wages and the supplier.
An equipment loan is built for that situation. This page explains the moving parts so you can walk into the conversation knowing what matters.
How does an equipment loan work for a tradie?
You pick the machine or tool set, get a quote, and a lender provides the money to buy it. You then repay across an agreed term. During that time the equipment is working for you, which is the whole idea: the repayments are funded by the work the kit makes possible.
Depending on the size and your situation, this can sit inside:
- an unsecured business loan, commonly in the $5k to $500k range
- a property-secured loan, from $20k to $5m, which suits larger or more complex purchases
- a smaller working-capital facility, where the kit is modest and quick
What do lenders want to see before they say yes?
Think of it as two files, one on the equipment and one on the business.
The equipment
- A written quote or invoice from the supplier
- Make, model, age and, for machines, hours
- Whether it is new, demonstrator or second-hand
- Serial numbers where they exist
The business
- ABN and how long you have traded
- Recent business bank statements, which show the pattern of deposits
- Who your customers are and how they pay
- What the equipment will do for revenue
A tidy file moves faster than a perfect one. Missing quotes and mismatched details are the most common reason things stall.
Should I put down a deposit?
A deposit shows commitment and lowers the amount borrowed, which can make approval easier. It is not always required. If cash is tight, the no deposit page covers what that usually looks like and what the trade-offs are. If you own property, security can also change the options available.
What are the real ongoing costs of owning equipment?
Repayments are only one line. Before you commit, add up:
| Cost | What to think about |
|---|---|
| Insurance | Cover on site, in storage and in transit |
| Servicing and repairs | Parts, labour and time off the job |
| Consumables | Blades, bits, filters, fuel, oil |
| Storage and security | Lock-up, trailer, site container |
| Training and licences | Some plant needs a ticket to operate |
| Replacement planning | What happens when it wears out |
Running those numbers through the equipment payback calculator shows whether the machine really earns its place.
Want to check your options on a purchase?
With a quote in hand, you can see where your equipment loan could land. The form takes about a minute, and your credit file is not checked to begin with.
An illustrative example
This is a made-up scenario for explanation only.
A two-person trade business wants to add a second set of professional gear so a new apprentice can work separately. Together the tools and a lockable storage box cost a figure the owner would rather not take from the operating account in one go, especially with BAS due in a few weeks. Instead of paying outright, the owner borrows against the purchase and repays monthly from the extra jobs the second crew can run.
If the second crew books enough work, the repayment is covered with room to spare. If it does not, the owner can reassess early, which is why it is smart to test the numbers before signing.
How should I choose between a loan, a lease and cash?
Each approach spreads cost and risk differently. Paying cash is simple but empties the account, a loan builds ownership, and a lease can cut the early outlay while treating ownership differently. Your tax position matters as well, so ask your accountant how the ATO’s depreciation rules apply to you. The ATO currently shows a $20,000 threshold in its simplified depreciation rules for small businesses with turnover under $10m, though check the year you plan to buy. The buy vs lease vs loan page goes deeper.
What mistakes slow an equipment loan down?
A handful of avoidable problems cause most of the delays. Quotes that do not match the amount requested make lenders pause and ask questions. Bank statements that are months old do not show how the business is trading now. A purchase from a seller who cannot be identified, such as an anonymous online listing, is harder to assess. And vague answers about what the equipment will earn leave a file thin. Fixing these before you apply costs nothing, and it often turns a back-and-forth of a week into a straightforward conversation. If anything unusual is going on, such as a gap in trading or a past default, say so on the form rather than hoping it will not come up. Lenders deal with real businesses, and a clear explanation lands far better than a surprise.
Ready to see if you qualify?
A spotless file is not a requirement. Say what you want to buy, how the business trades and what you can put towards it. A first enquiry is not a credit check, your details do not circulate among a crowd of lenders, and a real person looks into the situation. Frank, accurate answers let us line up the right option at the first attempt, so begin your equipment enquiry whenever the quote is ready. For the full picture of what is on offer, the equipment finance overview covers every type of kit.
Frequently asked questions
What is the difference between an equipment loan and a general business loan?
An equipment loan is tied to a specific purchase, so the asset helps the lender judge the risk. A general business loan can be spent on anything business-related. Many tradies use a working-capital loan for smaller kit and an asset-linked structure for heavy plant.
Do I need an ABN and how long should I have traded?
An ABN is the starting point. Longer trading history helps, but newer businesses are still considered, particularly with a deposit or other security. Say how long you have been going on the form.
Can a sole trader borrow for equipment?
Yes. Sole traders are a large part of the trades market. What matters is the money moving through the business account and the purpose of the purchase.
What if the equipment is for a job I have not won yet?
Lenders prefer to see a clear earning purpose. A signed contract, a repeat client or a documented pipeline makes the case stronger than a hope.
Can I include delivery, attachments and accessories?
Often yes, if they are itemised on the quote. Mention them upfront so the amount matches the full cost of getting the machine working.
Short on time? Enquire right here
About 60 seconds. No credit check when you first enquire, and a real person calls you back.