Construction Equipment Financing: 3 Options for 2025

Summary

Canadian contractors face rising equipment costs and tighter project deadlines in 2025. Excavators, compact track loaders (CTLs), loaders, telehandlers, and attachments are critical to meeting schedules—but tying up capital in upfront purchases can choke cash flow. This guide breaks down three proven financing tools—loans, leases, and sale-leasebacks—and shows how to align them with your cash cycle for faster approvals and sustainable growth.

Why equipment financing matters now

Construction equipment prices have climbed 10–15% in Canada over the last two years, driven by inflation in steel, supply chain volatility, and higher import costs. At the same time, project contracts are increasingly fixed-bid with penalties for delays, which means uptime and fleet readiness directly affect profitability.

Financing isn’t just about affordability—it’s about cash-flow management:

• Protecting working capital for payroll, mobilization, and materials
• Matching payments to project timelines
• Scaling fleets without slowing bids or delivery

Three financing options for 2025 contractors

How to choose quickly

• Keep it 7–10+ years? → Choose an equipment loan for straightforward ownership and resale value.
• Need the lowest monthly to win a bid? → Go with an equipment lease paired with a 10% or FMV buyout.
• Cash tied up but crews are waiting? → Use a sale-leaseback to release equity from existing machines without downtime.

If you expect multiple purchases in a season, add an Equipment Line of Credit. For consumables, payroll, or mobilization, layer in a Working Capital Loan.

What we finance (examples)

• Excavators (mini to 50-ton)
• Compact track loaders and skid steers
• Wheel loaders and backhoes
• Telehandlers and compaction equipment
• Productivity tools: breakers, thumbs, tiltrotators, quick couplers, trenching buckets
• Site support: light towers, DEF/fuel tanks, telematics systems

See Eligible Equipment for a full list. Mehmi also sells equipment directly—browse inventory.

24–48h approval checklist

Organized files = faster approvals. Here’s what underwriters look for:

• Vendor quote (make/model, year, hours/km, serials, attachments)
• 3–6 months of business bank statements (PDFs; all operating accounts)
• One short use-of-funds note (project scope, delivery timing, utilization hours)
• Insurance broker contact (binder with lender as loss payee)

See more insights under Construction & Contractors.

Market insights for 2025

• Infrastructure spend: Federal and provincial budgets are pumping billions into transit, housing, and roadworks—driving excavator and loader demand.
• Used equipment values: Shortages mean clean used machines under 5,000 hours are commanding high resale value—making leases with residuals more attractive.
• Technology adoption: Telematics, GPS, and tiltrotators are increasingly bundled with base equipment financing to meet productivity targets.
• Cash cycle strain: AR on large projects often stretches to 45–60 days. Pairing equipment loans with factoring or LOC facilities prevents payroll gaps.

Quick scenario

A mid-sized sitework firm in Ontario needed a 20-ton excavator, hydraulic thumb, and compaction wheel before subdivision grading. Using Mehmi’s calculator, we compared a 60-month loan vs. a lease. The lease with a 10% buyout kept monthly payments 18% lower, freeing working capital for mobilization costs. Funding cleared in under 48 hours, aligning with equipment delivery and site start.

FAQ: Construction Equipment Financing

Can I finance used or private-sale units?
Yes—often approved subject to condition, hours, and serials. Start at Equipment Financing.

What if my AR pays in 45–60 days?
Keep iron on a loan/lease and bridge cash gaps with a Line of Credit.

How do I keep payments comfortable during slow months?
Use a lease residual, longer term, or supplement with revolving credit. Model options in Mehmi’s calculator.

Do you coordinate purchase and delivery?
Yes—we align invoices, insurance, PPSA, and vendor coordination. Buying direct from Mehmi’s inventory is often fastest.

Final thoughts

Canadian contractors can’t afford downtime or capital bottlenecks in 2025. By choosing the right financing mix—loan, lease, or sale-leaseback—you protect cash flow while scaling capacity.

👉 Run payment terms in our calculator or contact our credit analysts to get a tailored construction equipment financing plan today.

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