As the number of commercial, residential, and industrial projects grow across the country, the amount of equipment construction companies require to stay competitive in the booming market, has also increased exponentially. Bulldozer, cranes, forklifts, graders, excavators, and more - Whether you’re working on a construction site or conducting road maintenance, there’s a wealth of construction equipment available to you. However, there’s one major hurdle to overcome - the price.
You might be seeking a new piece of equipment for safety reasons, or maybe you want to make your project more efficient and tackle bigger tasks. Most construction businesses need equipment in order to operate. However, funding such substantial items can be impossible without financing. Fortunately, there is a wealth of financing options available on the lending market, making it possible for construction companies to get the equipment they need without shouldering the full burden of upfront costs.
Equipment Leasing
In construction equipment finance, equipment leasing involves a business renting machinery from a leasing company for a certain period of time, rather than buying it outright. In this arrangement, the leasing company will still have ownership of the equipment, but will receive monthly rental payments from the business over the lease term. At the end of the lease term, the business might have the option to return the equipment, purchase the equipment, or extend the lease. Equipment leasing is a good financing option because it requires less initial capital to buy, allowing businesses to preserve their cash flow.
Equipment Chattel Mortgage
A chattel mortgage for construction equipment finance is when the lender uses the construction equipment as security for the money extended in the loan. Under a chattel mortgage arrangement, the borrower will repay the loan in equal monthly repayments over a fixed loan term. By financing your construction equipment with chattel mortgage, you’ll be able to acquire necessary equipment without a significant upfront cost. Chattel mortgages can often include flexible terms, including a balloon payment option, making them ideal for optimising cash flow.
Equipment Hire Purchase
Financing construction equipment via equipment hire purchase involves a business buying construction equipment through a series of regular payments. Equipment hire purchase is similar to leasing, however the business will own the equipment once all payments have been made. For this form of finance, an initial deposit will generally be made, followed by the fixed monthly payments over a specific period of time. During the hire purchase period, the business can use the equipment but does not own it until the final payments has been made.
Unsecured Business Loan Option for Equipment
Businesses wanting to acquire construction equipment without providing collateral, can do so via an unsecured business loan. This financing option is ideal for businesses who don’t have substantial assets, or prefer not to put them at risk. Unsecured business loans are based on the creditworthiness and financial health of the business, and will often have higher interest rates. While this financing option is flexible and able to be obtained quickly, your business must have a strong credit profile to qualify. Unsecured business loans are suitable for construction businesses who want to maintain asset flexibility while acquiring the equipment they need.
Learn More About Construction Equipment Finance with Jade Finance
Are you looking to purchase or rent a piece of construction equipment for your next job or project? Jade Finance is a reputable and highly trusted brokerage in the Australian lending market, providing top-quality equipment finance via our extensive list of 80+ lenders and brokers. Our team of dedicated, experienced brokers are eager to help you get the most out of your purchase.
Contact us online to learn more about the financing options we provide, or call us on 1300 000 003.
