Whether you run a warehouse, fabrication shop, or food facility, forklifts are revenue equipment—every hour they’re down, margin slips. Banks often want perfect financials and newer units; private lenders price deals on asset quality and cash-flow reality. As both a seller of commercial assets and a financing partner with 30+ Canadian lenders, Mehmi Financial Group places forklift files daily—dealer or private sale, new or used, electric or ICE. Below is a practical comparison so you can choose the lane that fits your situation. If you’d like a quick read on your file, feel free to contact our credit analysts.
Quick verdict: when each path wins
- Choose a bank/credit union if you have 2+ years of strong financials, clean statements, and can wait a bit longer for underwriting. You’ll usually land the lowest headline rate and longer amortization.
- Choose a private lender if timing, asset age, private sale, or credit bumps are in play. Expect faster decisions, broader asset tolerance, and structures that match reality (seasonal, residuals, sale-leaseback).
For a ballpark payment, try our calculator, then we’ll price both lanes side by side.
What underwriters actually look at on forklifts
Asset signals
- Make/model/year, powertrain (electric lead-acid/lithium vs. LPG/diesel), hours, tire type, lift height, side-shift/fork positioner, battery age & test (for electric), emissions compliance (ICE).
- Documentation: serial, clean lien search, recent inspection, service history.
Business signals
- Use case & revenue math: shifts/day, loads/hour, rental-replacement savings.
- Bank behaviour: 3–6 months statements, steady deposits, low NSFs, headroom for the payment.
- Owners ≥25% for guarantees; co-signer/collateral strengthens softer files.
If one area is light (e.g., young company), we offset with structure—down payment, residual, or shorter term.
Terms you’ll actually see (Canada, 2025 reality)
- Structures: Lease-to-own ($10/$1 buyout), FMV/Residual (often 10–20%), or sale-leaseback on an owned unit to free cash.
- Term length: 24–60 months typical; 72 months on newer Tier-compliant or lithium units with strong resale.
- Down payment: 0–10% for bankable files/dealer units; 10–30% for startups, private sales, older/high-hour, or bruised credit.
- Conditions: PPSA lien, documentation fee, first/last in advance, proof of insurance (lender as loss payee), inspection/GPS as required.
- Funding speed: Private: 24–72h from approval with docs ready; Bank: longer but cheapest capital when you qualify.
Explore options or submit in one shot: Leasing & Loans.
Bank vs. Private: side-by-side snapshot
| Factor | Bank / Credit Union | Private Lender |
| Headline rate | Lowest | Higher, priced to risk |
| Approval speed | Slower | Fast (24–72h common) |
| Asset tolerance (age/hours/private sale) | Narrow | Broad (incl. private sale) |
| Documentation burden | High (statements, financials) | Moderate (bank statements, IDs, invoice) |
| Structures | Conventional lease/loan | $10 buyout, FMV, sale-leaseback, seasonal/skip |
| Best for | Established firms with time | Startups, growth, uneven cash flow |
Picking the right structure for your operation
- Keep long-term (5+ years): Choose $10/$1 buyout; predictable total cost and equity at end.
- Refresh often or scaling fast: Choose FMV/Residual to lower monthly and make upgrades painless.
- Tight cash but strong jobs: Use a sale-leaseback/refinance on owned gear to fund the down payment or add a second unit.
If receivables are lumpy, overlay invoice factoring or a working-capital/LOC so lease payments don’t squeeze payroll and parts.
Budget the “true monthly,” not just the payment
- Insurance (correct loss-payee language)
- Battery care (watering, equalize cycles, replacement reserve) or ICE maintenance (filters, emissions/DEF)
- Wear items (tires, forks, chains), annual safety inspections
- Charging or fuel infrastructure (outsized for lithium conversions)
- Downtime reserve: target 1–1.5 payments saved
Run numbers with our calculator, then add these operating costs to confirm margin.
Case pattern (Ontario distribution center)
A 3-year-old warehouse needed two late-model electrics (one lithium, one lead-acid) and a used diesel yard truck. Bank hesitated on the private-sale lithium pack and thin retained earnings. We placed a 48-month FMV lease with a private lender:
- 10% down, first/last in advance; battery test printouts attached
- Seasonal skip in January; insurance binder same day
- Added a $75k LOC to smooth payroll while new contracts ramped
Outcome: lower monthly than renting, new contracts serviced on time, and flexibility to rotate at term.
Fast-track application checklist
- Invoice/quote, serial, hours, photos (mast, carriage, battery/engine, tires, cab/controls)
- Battery test (electric) or recent service (ICE), last safety inspection
- 3–6 months business bank statements
- IDs for all owners ≥25%; corporate registry
- Insurance broker contact to bind with lender as loss payee
- Short use-of-funds note (routes, shifts, rental replacement)
Upload once via Leasing & Loans—we route to the best-fit lender the same day.
FAQs
Can I lease a used forklift from a private seller?
Yes. Private lenders fund private-sale forklifts routinely with extra diligence (inspection, lien search, bill of sale). We manage the paper trail. Start here: Leasing & Loans.
Is FMV or $10 buyout better?
Keep it long term → $10/$1 buyout. Expect to rotate or want the lowest monthly → FMV/Residual.
What credit score is needed?
Banks often want 650–700+ with strong financials. Private lenders can work below 650 with compensating factors (down payment, contracts, co-signer, collateral). Contact our credit analysts for a tiered quote.
How fast can I get funded?
With a complete package and insurance ready, 24–72 hours from approval is common in private lending. Use the calculator for estimates.
Can I raise the down payment without draining cash?
Yes—use Refinancing/Sale-Leaseback on owned equipment, or bridge with a working-capital/LOC. If receivables are slow, consider invoice factoring.
Why Mehmi (seller + financier, Canada-wide)
We’re unusual in Canada: we sell commercial assets and finance them—daily. Our credit team knows real auction values, battery degradation curves, and the flags underwriters spot immediately. We place files across 30+ lenders, deliver 24–48h approvals for deal-ready packages, and tailor payments to your shift patterns and seasonality.
Next step: Want a pre-approval before you negotiate—or a second look after a bank decline? Feel free to contact our credit analysts for a friendly, no-pressure review: Contact Us. Prefer to see numbers first? Use the calculator.
.avif)