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Learn how construction equipment dealers can offer customer financing in the U.S. and Canada for new and used heavy equipment.
A contractor may need a CAD $180,000 excavator or USD $350,000 equipment package because the next job requires it, while still needing cash for payroll, fuel, materials, bonding, mobilization and project holdbacks.
That creates an opportunity for construction equipment dealers.
Instead of giving the customer an invoice and telling them to find a bank, the dealership can make financing part of the equipment-buying process.
Quick Answer: Construction equipment dealers can offer customer financing through third-party lenders, lessors or financing brokerages that underwrite the buyer and fund qualifying transactions. A strong program covers new and used equipment, gives customers clear payment options, routes more difficult applications appropriately and pays the dealer after all funding conditions are satisfied.
A customer financing program gives your dealership a repeatable way to help commercial buyers finance equipment at the point of sale.
The dealership does not necessarily lend its own money.
Instead, the customer applies through a financing provider, lessor or intermediary. The financing source evaluates the business and equipment, determines the available structure and completes the financing agreement.
Once all funding conditions are satisfied, the equipment dealer is paid according to the transaction documents while the customer repays the financing provider.
This can apply to equipment such as:
The financing conversation should therefore become part of the sales process rather than something introduced only after the customer says the equipment is too expensive.
Canadian dealerships looking specifically for a sales-floor workflow can also review Mehmi's existing Construction Equipment Customer Financing Dealer Playbook.
Construction businesses rarely generate perfectly even monthly cash flow.
Revenue may depend on project starts, progress draws, retainage or holdbacks, weather, seasonality and customer payment cycles.
At the same time, a contractor often needs to purchase the machine before the new work generates cash.
That makes payment structure important.
The Equipment Leasing and Finance Association's 2025 Survey of Equipment Finance Activity reported that construction equipment represented 17.5% of new business volume among participating U.S. equipment finance companies for 2023–2024, with 2024 construction-equipment volume reaching $21.9 billion in that survey. That figure reflects ELFA survey participants rather than the entire U.S. financing market. Elfa Online
In Canada, Statistics Canada reported that the commercial and industrial machinery and equipment rental and leasing industry generated CAD $18.1 billion in operating revenue in 2024, and specifically noted that higher capital spending supported construction-sector demand for heavy machinery and equipment rental and leasing. That dataset covers the rental/leasing industry and should not be interpreted as construction-equipment financing volume. Statistics Canada
The takeaway for dealers is not that every contractor should finance equipment. It is that financing and leasing are established parts of how North American businesses acquire productive machinery.
Most independent construction equipment dealers do not need to build an in-house lending company.
A simple referral model is the easiest starting point. The salesperson identifies a buyer who needs financing and sends the customer to the financing partner.
A formal vendor financing program goes further. Financing becomes part of your normal quote, application, underwriting, documentation and delivery process.
A dealer-branded or white-label program places your dealership's branding around more of that experience while an outside provider remains responsible for the actual underwriting and financing.
Dealers with larger sales volume may eventually integrate financing into their CRM, quoting software or website. Mehmi's POS equipment financing integration guide explains how that model differs from simply sending customers a lender's phone number.
Canadian sellers can compare these models in Equipment Dealer Customer Financing in Canada, while dealerships considering a branded approach can review White Label Equipment Financing for Dealers.
The correct model depends on your deal volume, average ticket, internal sales process and how much of the financing experience you want your staff to manage.
Do not create a financing menu with ten products that your sales team cannot explain.
Start with the financing structures that correspond to how contractors actually buy equipment.
An equipment loan or finance agreement generally fits buyers who ultimately want ownership and can support an amortizing payment.
An equipment lease may provide different ownership, residual or purchase-option arrangements. The customer needs to understand exactly what happens at the end of the lease rather than assuming every lease automatically transfers ownership.
Seasonal or structured payments may sometimes better match businesses whose revenue is concentrated in particular parts of the year. Availability depends on the financing source and borrower.
Repeat buyers acquiring multiple machines over time may sometimes benefit from an equipment line or other facility instead of applying for every purchase as an unrelated transaction.
Construction dealers should also distinguish equipment financing from working capital. A working-capital facility could help a contractor bridge mobilization, payroll or receivables, but it is not interchangeable with financing the excavator itself.
For Canadian dealerships, Mehmi's Customer Financing Menu guide provides a practical way to keep the customer-facing financing choices simple.
Construction equipment financing is not approved solely because the machine has resale value.
Credit typically starts with the buyer's repayment capacity.
The financing provider may review revenue, operating cash flow, bank activity, financial statements, existing loans and leases, tax obligations where relevant, owner credit, liquidity and business history.
Existing debt matters because a contractor earning substantial revenue can still have very little capacity for another equipment payment.
The financing source then reviews the asset.
A late-model Caterpillar excavator with documented hours, established dealer support and a broad resale market presents different collateral risk from a heavily modified machine from an obscure manufacturer.
For used equipment, expect attention to:
The financing term should make sense relative to that remaining useful life.
A seven-year financing term can lower the monthly payment, but it may be poor structuring if the machine is likely to require major rebuilding well before the financing ends.
U.S. business owners wanting a deeper borrower-side view can review Equipment Financing for Established Small Businesses.
Used equipment should have its own intake process.
The dealer should identify the actual unit early rather than sending an application for "one excavator."
Provide the financing partner with the year, manufacturer, model, serial number, hours, attachments, condition and accurate selling price.
Older, unusual or high-hour machines may require additional valuation or inspection.
Private-sale equipment usually creates more verification work because the financing provider may need to confirm ownership, seller identity and whether another creditor has an existing interest in the asset.
Trade-ins also deserve attention.
The trade should be clearly identified, along with any outstanding payout and how the equity is being applied to the new transaction.
A good dealer program therefore needs both a clean new-equipment lane and a more controlled used-equipment lane.
Give the customer the equipment price first.
Then show financing as an alternative method of paying for that purchase.
Avoid displaying a low monthly payment without explaining what creates it.
A meaningful estimate should identify the equipment price, assumed upfront contribution, amount financed, assumed rate or pricing, term, payment frequency and any residual or end-of-term amount.
It should also identify whether taxes and financing fees are included.
Canadian sales teams can use Mehmi's dealership financing scripts for examples of how to introduce financing without promising an approval.
The purpose of payment selling should be to help the customer understand cash flow—not to hide the total equipment cost.
Assume a Canadian construction dealer is selling an excavator for CAD $180,000 before applicable taxes.
The customer contributes 15%, or CAD $27,000, leaving CAD $153,000 financed.
For illustration only, assume:
The estimated payment is approximately CAD $3,213.28 per month.
Over 60 payments, estimated financing repayment would be approximately CAD $192,797.09.
That includes approximately CAD $39,797.09 of interest on the CAD $153,000 financed.
Including the CAD $27,000 initial contribution, the buyer's estimated equipment and financing cash outflow would be approximately CAD $219,797.09, before the excluded taxes and expenses.
This is an illustrative calculation, not a Mehmi Financial Group offer or indication that a 9.50% rate or 15% contribution would be available.
The underwriting question is whether the contractor can reliably absorb another CAD $3,213 monthly payment during both strong and slower periods—not merely whether the next project produces enough revenue.
Canadian dealers can model alternative prices, terms and contributions using Mehmi's Equipment Financing Calculator. Calculator results are estimates, not approvals or financing offers.
The financing partner reviews the application and determines whether more information is necessary.
An established contractor buying a standard piece of equipment may require a different package from a startup acquiring its first excavator.
Larger or more complex requests may require financial statements, interim statements, bank statements, a debt schedule, project or contract information and further details about the owners or guarantors.
If approved, the financing source issues terms and any outstanding conditions.
Those conditions can include insurance, final invoice verification, proof of customer contribution, serial-number confirmation, lien clearance, delivery information or signed financing documents.
Approval does not mean the dealer has been funded.
Your delivery policy should define exactly which confirmation your sales and operations teams need before releasing equipment.
That distinction becomes particularly important with expensive machines, cross-border transactions and pre-delivery funding requests.
Canada uses provincial secured-transactions systems rather than the U.S. UCC framework.
For example, Ontario's Personal Property Security Registration system allows creditors to register notices of security interests in personal property used as collateral. Ontario also explains that registrations help establish priority where different parties have interests in the same property. Ontario Canada
Quebec uses the RDPRM. Its official guidance identifies movable hypothecs and other registered rights affecting commercial goods such as equipment, tools and inventory. Ressources naturelles et Faune
Dealers should therefore provide exact legal business names and accurate asset identifiers rather than attempting to manage secured-credit registrations themselves.
Customer information also needs to be handled properly. The Office of the Privacy Commissioner of Canada states that organizations subject to PIPEDA are generally required to obtain meaningful consent for the collection, use and disclosure of personal information. Provincial requirements can also apply. Office of the Privacy Commissioner
A practical solution is to route sensitive credit information through the finance provider's secure application rather than having sales representatives collect identification, bank statements and credit information through ordinary email.
Canadian dealers starting from scratch can follow Mehmi's How to Offer Financing to Your Equipment Customers in Canada.
The U.S. system is different.
Article 9 of the Uniform Commercial Code generally governs security interests in personal property, subject to each state's enacted version and other applicable laws. Filing a financing statement is a common method of perfecting a secured party's interest, although titled property and other specific assets can involve additional rules. Legal Information Institute
Commercial financing regulation is also not completely uniform across states.
California, for example, has commercial-financing disclosure requirements for covered transactions, while New York has its own Commercial Finance Disclosure Law and regulations for covered commercial financing offers. DFPI
That means a dealer or financing company operating in multiple states should not assume that one nationwide financing script, disclosure package or brokerage structure is automatically sufficient everywhere.
Actual product availability should be verified for the buyer's state before the dealership promises a financing option.
Dealers selling to established U.S. contractors can use Mehmi's U.S. equipment-financing guide for established businesses as a customer-facing companion resource.
Build a second-look process into the program.
Do not simply send the same application indiscriminately to more financing companies.
First determine why the application was declined.
The problem might be cash-flow coverage, credit, leverage, insufficient upfront equity, equipment age, asset type, documentation or an issue specific to that financing provider's credit policy.
Then determine whether the transaction can reasonably be improved.
A larger customer contribution may reduce exposure. A different term may better match useful life. Better equipment documentation may resolve collateral concerns. A different financing provider may have an appetite for the customer's industry or asset.
But some deals should remain declined.
If the customer cannot reasonably make the payment, is already experiencing ongoing operating losses or cannot verify important financial information, obtaining more expensive capital does not necessarily save the transaction.
For other heavy-equipment suppliers facing similar issues, Mehmi's Mining Equipment Supplier Financing guide shows how lender matching changes as asset specialization increases.
Do not evaluate a financing partner only by the lowest advertised rate.
A dealer program needs operational depth.
You need to know whether the partner can handle new and used equipment, different transaction sizes, established and newer contractors, trade-ins, attachments, cross-border transactions where applicable and customers outside a narrow prime-credit profile.
Ask how applications are routed when the first financing source declines them.
Ask how the partner handles incomplete documents.
Understand what information salespeople are allowed to quote and what must wait for underwriting.
Ask what happens with early payouts, liens or security registrations, personal guarantees, fees and end-of-term lease obligations.
Most importantly, understand when the dealership gets paid.
Dealers interested in outsourcing more of the process can read Financing as a Service for B2B Companies.
For U.S. dealers that also sell north of the border, U.S. Equipment Dealer Financing for Canadian Customers covers the additional currency, import and Canadian security-registration issues.
Financing should support a commercially sensible equipment purchase.
It should not turn an uneconomic machine into a good investment.
A contractor may be better off buying a less expensive used machine, increasing the down payment, renting equipment for a short project, waiting until additional contracts are secured or not purchasing yet.
Likewise, financing a machine over a long period solely to produce an attractive displayed payment can create problems if the equipment's useful life is shorter than the debt.
The best dealership financing programs therefore help salespeople identify financeable customers, not pressure every customer into financing.
Yes. A dealership can work with third-party lenders, lessors or a financing brokerage. The financing provider supplies the capital and controls its underwriting decision while the dealer sells the equipment.
Potentially. Age, hours, condition, remaining useful life, purchase price, seller, maintenance history and resale value become increasingly important with used assets.
Sometimes. Buckets, breakers, grading systems, trailers and other attachments may be eligible when clearly identified on the invoice and acceptable to the financing source. Eligibility should be confirmed before promising the customer that every soft cost or attachment can be financed.
No universal percentage applies. Customer contribution depends on credit, cash flow, asset quality, purchase price, lender exposure and the specific financing program.
Potentially, but underwriting may require more support because the business has limited operating history. Owner experience, credit, liquidity, customer contribution, contracts and equipment quality may become more important.
It can, provided the assumptions are clearly disclosed and the payment is presented as an estimate rather than a guaranteed offer. Final pricing and terms remain subject to underwriting.
Potentially, but the program needs separate country-specific financing and compliance infrastructure. U.S. UCC rules and state requirements should not be substituted for Canadian PPSA or Quebec RDPRM requirements.
Mehmi Financial Group works as a financing brokerage and intermediary, helping construction equipment dealers, distributors, OEMs and other B2B sellers build financing into the sales process across applicable parts of the United States and Canada.
Mehmi does not directly control lender underwriting and does not guarantee approval, rates, terms or funding timelines.
To discuss a dealer program, be ready to share your typical financing amount, whether your customers are in the U.S. or Canada, the states or provinces you serve, the construction equipment you sell, how the equipment will be used and your normal sales and delivery timing.
Call Mehmi Financial Group at 833-863-4644 or contact Mehmi Financial Group to discuss a construction equipment customer financing program.
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