Can you finance an excavator with bad credit? Yes, it’s possible. While traditional banks may decline applicants with low credit scores, some equipment financing lenders consider borrowers with bankruptcies, repossessions, judgments, and other credit challenges. Depending on your situation, financing may be available with a larger down payment, additional collateral, or other compensating factors.
Great news! As an equipment finance broker, we work with a wide range of lenders, giving us the ability to match business owners with the best possible options. We have numerous lending partners for those with strong credit, but more importantly, we offer plenty of solutions for those facing even the most challenging credit situations, and everything in between.
We’ll explore some of the excavator financing options available for individuals with bad credit.
Recognizing that poor credit comes in varying degrees, we’ll cover financing solutions for both the most challenging credit situations and those with slightly better, yet still less-than-perfect, credit.
Please contact us at Info@TheBroker.Finance for more info about excavator loans with bad credit or at (714) 271-8524
Specific Credit Issues That Can Hinder Excavator Financing With Bad Credit
There are many credit-related factors that can impact your ability to secure excavator financing if you have bad credit. As an equipment leasing and financing broker, we have partnerships with a wide range of banks, lenders, equipment financing options, and private money financiers. Our goal is to assist business owners with less-than-perfect credit in obtaining the equipment they need to start, grow, or enhance their small businesses.
We’ll talk about a couple options that may help you finance your new or used excavator.
Here are some credit challenges we can potentially overlook when financing an excavator with less-than-perfect credit:
- Credit scores DO NOT matter for some programs
- Bankruptcy (recent, but does need to be dismissed or discharged, but can be as recently discharged as yesterday).
- Repo’s
- Judgments Ok
- Works for private party sales
- Too much revolving credit on credit report
- Start Up construction / contractor companies that use heavy equipment
- Tax liens
- Owner / Operators
- Slow pay on revolving accounts
Please contact us at Info@TheBroker.Finance for more info about excavator financing with bad credit or at (714) 271-8524
Excavator Loans with Bad Credit Option 1 (Worst of Credit)
We work with several lenders who can provide financing for excavators, even for those with the most challenging credit situations. Here’s how it works: we have a few options that allow us to offer financing to almost anyone (subject to lender approval and not a guaranteed).
- If you have a down payment of 25% – 40% then we have a lender that will finance your excavator for almost any credit scenario
- If you don’t have a down payment to the tune of 25% – 40%, you can potentially pledge secondary collateral. Typically, they are looking for a 1:1 ratio in terms of the secondary collateral. Below is an example:
Let’s say you have a Kenworth T-800 dump truck (or any other heavy equipment, commercial vehicles, yellow iron, etc.) that’s got an auction value of $42,000 and it’s free and clear with no liens. This free and clear truck can be pledged as secondary collateral to help you finance a new excavator despite your credit issues. In this scenario, they are looking for a 1 to 1 ratio, so you’d be able to finance an excavator for up to $42,000 with almost no down payment.
Please contact us at Info@TheBroker.Finance for more info about excavator truck financing with bad credit or at (714) 271-8524
Excavator Financing with Bad Credit Option 2 (Less Damaged Credit)
We work with another lender who offers financing for heavy equipment with a down payment of around 35%, even for clients with credit scores below 570. This lender values understanding the background of your financial situation and is particularly interested in hearing about your future plans, such as any jobs or contracts you have secured with the new credit.
There are no strict guidelines in place. They do offer basic guidelines, but I’ve seen them approve financing outside of those parameters as well.
A Texas contractor with over 25 years of experience found himself in need of an additional dump truck during the COVID-19 pandemic to keep up with high demand. However, traditional lenders, such as banks, declined his request due to a minor charge-off and a debt settlement that had occurred more than four years prior. The deal was appealing to this particular lender because the contractor provided a 50% down payment and the collateral showed strong auction comparisons.
Lender’s Solution: $40,750 36-month term loan
Collateral: 2014 Freightliner Cascadia CA12DC Quad-Axle Dump Truck priced at $81,500
Please contact us at Info@TheBroker.Finance for more info about excavator loans with bad credit or at (714) 271-8524
We operate as a broker, partnering with numerous top lenders who can accommodate a wide range of credit and business situations. If your specific scenario isn’t mentioned here, feel free to reach out to us by phone, text, or email. Let’s connect and explore how we can help you secure the new equipment your business needs.
Frequently Asked Questions About Excavator Financing With Bad Credit
If you’re looking to finance an excavator but have less-than-perfect credit, you probably have questions about qualifying, down payments, and purchasing used equipment. Here are answers to some of the most common questions I receive.
What Credit Score Do You Need to Finance an Excavator?
You don’t necessarily need good credit to finance an excavator. While traditional banks typically prefer borrowers with stronger credit, some equipment financing lenders will consider applicants with credit scores in the 500s or even the 400s. I’ve worked with lenders that focus more on the overall strength of the transaction than just your credit score. Factors such as time in business, monthly revenue, available down payment, and the equipment itself can make a big difference. Even if you’ve had a bankruptcy, repossession, or other credit problems, you may still have financing options. Every situation is different, so don’t assume you won’t qualify just because your credit isn’t perfect.
How Much Down Payment Is Required for Excavator Financing With Bad Credit?
The down payment will depend on your credit, business history, revenue, and the excavator you’re purchasing. For borrowers with challenged credit, some programs may require approximately 10% to 25% down, provided the business meets certain revenue and underwriting requirements. Other programs may offer financing with around 40% down without the same revenue requirements. In some situations, additional collateral, such as free-and-clear equipment, may help reduce the amount of cash needed upfront. The important thing to understand is that there isn’t one down payment requirement that applies to everyone. I can review your situation and help determine which financing options may be available.
Can You Finance a Used Excavator From a Private Seller?
Yes, financing a used excavator purchased from a private seller is possible, even if you have less-than-perfect credit. However, private-party transactions generally involve additional requirements compared to purchasing from an established equipment dealer. Depending on the lender, you may need to provide photos of the excavator, a condition report or inspection, proof of ownership, and a bill of sale or invoice. The lender may also verify the equipment’s serial number, value, and ownership before funding. Not every lender finances private-party purchases, especially when credit is challenged, but I work with multiple equipment financing sources and can help identify programs that may fit your situation. If you’ve found an excavator you want to purchase, give me a call or send me a text, and let’s see what we can do.
In addition, we may be able to help with revenue based working capital and / or bad credit equipment financing.