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Learn how equipment sellers can offer customer financing in the U.S. and Canada without becoming lenders or carrying customer debt.
A customer wants your excavator, CNC machine, forklift, truck or commercial equipment package but does not want to remove $100,000 or $300,000 from the operating account.
Without a financing process, the sale can stall while the buyer calls its bank, compares lenders or postpones the purchase.
Equipment dealers, manufacturers and distributors can solve that problem by making financing part of the sales process without necessarily lending their own capital.
Quick Answer: Equipment sellers can offer customer financing by partnering with a commercial lender, lessor or financing brokerage. The seller provides the equipment quote and introduces financing, while the finance partner handles underwriting, documentation and funding. Approval, pricing, customer contribution and terms depend on the buyer, equipment, financing structure and applicable U.S. or Canadian jurisdiction.
No.
Offering financing does not necessarily mean your company lends its own money, sets credit policy or collects monthly payments.
A third-party equipment financing program separates the equipment sale from the credit decision.
Your company sells the equipment.
The financing provider or brokerage evaluates the customer and transaction.
If the deal is approved and all funding conditions are completed, the seller gets paid according to the agreed funding process and the customer repays the applicable financing provider.
For Canadian dealers, Mehmi's Vendor Equipment Financing Canada: Dealer Program Guide explains this third-party model in more detail, including the difference between dealer responsibilities and lender responsibilities.
The broader Dealer Finance Program Canada: Third-Party Setup is useful for sellers that want a repeatable finance-desk process rather than occasional lender referrals.
Mehmi Financial Group itself operates as a financing brokerage/intermediary rather than the direct lender. Its current vendor program says it supports dealers, OEMs and distributors across North America through third-party financing partners.
A good program begins while the customer is still discussing equipment with your salesperson.
The first step is an accurate equipment quote.
The salesperson then asks whether the customer plans to pay cash, use its own bank or review financing options through the seller.
If the customer wants financing, it completes an application through the applicable finance partner.
Underwriting then reviews the business and equipment.
Depending on the transaction, that may include credit, cash flow, bank activity, operating history, existing debt, ownership, equipment age, condition and collateral value.
An approval can still have conditions.
Insurance, signatures, proof of customer contribution, final equipment details, lien searches or delivery confirmation may still be required before the finance provider releases funds.
Only then should the seller treat the deal as ready for financed delivery.
For a detailed Canadian seller workflow, Mehmi's How to Offer Financing to Your Equipment Customers in Canada walks through referral, branded and integrated financing models.
Do not present every transaction as the same product.
An equipment loan or finance agreement can make sense when the customer wants long-term ownership and predictable amortization.
A lease may create a different ownership and end-of-term structure. Depending on the contract, the customer may have a fixed purchase option, residual obligation or fair-market-value decision at maturity.
Some seasonal businesses can benefit from payment schedules designed around their operating cycles, subject to finance-provider approval.
Repeat buyers may eventually need an equipment line or broader facility rather than submitting an unrelated application for every asset.
The product should follow the equipment, customer and intended ownership outcome.
Canadian sellers that specifically want to lead with leasing can use Mehmi's Offer Equipment Leasing as a Dealer as a supporting sales guide.
Do not tell customers that leasing is always cheaper, that it always provides better tax treatment or that ownership always costs more. Those conclusions depend on the actual agreement, taxes, residuals, financing costs and how long the customer intends to keep the asset.
Ideally, before price becomes an objection.
A salesperson can present both the cash price and the availability of financing.
For example:
"This machine is $120,000. If preserving cash is important, we can also arrange financing options subject to approval."
That is enough to start the conversation.
The salesperson does not need to become a credit analyst.
Mehmi's Dealer Financing FAQ for Sales and Service Teams similarly recommends making financing part of the normal customer experience while avoiding unsupported promises about rates or approvals.
Introducing financing only after a customer says the equipment is too expensive can make financing feel like a rescue product.
Introducing it during the original quote makes it one payment option among several.
You can present estimates where appropriate, but the assumptions need to be clear.
A monthly payment can change materially based on the financed amount, term, assumed pricing, down payment, advance payments, residual or buyout, taxes and fees.
Do not advertise:
"$1,499 per month"
with no explanation if only a narrow set of assumptions produces that payment.
A better presentation identifies the equipment price, assumed term and any required upfront contribution and makes clear that the payment is an estimate subject to approval.
For Canadian dealers that want financing integrated into their website, Mehmi's Co-Branded Financing Pages: What Dealers Put Above the Fold explains how to introduce payment options while avoiding misleading rate or approval claims.
Mehmi's separate Dealer-Branded Equipment Financing guide covers the broader white-label approach where the dealer's brand remains prominent while a financing partner performs the underlying credit functions.
This is one of the easiest areas for sellers to improve.
The financing provider needs to know exactly what it is funding.
A strong quote identifies the buyer and seller correctly and provides the equipment year, manufacturer, model and serial number or VIN where applicable.
Used equipment should include current hours, mileage or kilometres where relevant.
Significant attachments and permanently installed equipment should be identified separately.
The quote should also show the equipment price, customer deposit, trade-in allowance, freight, installation and applicable taxes clearly.
Avoid:
"Equipment package: $180,000."
Instead, make it obvious what assets make up the $180,000 transaction.
This matters because the lender is underwriting collateral as well as the borrower.
Mehmi's Canadian Equipment Financing Application Checklist explains how complete asset details, borrower documents and insurance readiness reduce avoidable closing questions.
The separate Documents Needed for Equipment Financing guide provides additional detail on dealer purchases, private sales, liens and asset verification.
The equipment is important, but the customer still has to make the payments.
Credit may review recent business revenue, available cash flow, bank activity, existing loans and leases, operating history and payment behaviour.
Larger transactions can require financial statements, tax returns, debt schedules and other supporting documents.
The lender also evaluates the equipment.
Mainstream commercial machinery with a broad secondary market may present stronger collateral than highly specialized equipment that could be difficult to remarket.
Used equipment adds questions around age, hours, condition, maintenance history and remaining useful life.
There is no universal credit score, annual revenue, down payment or time-in-business threshold that guarantees equipment financing.
A seller should therefore avoid telling customers:
"You need a 650 score."
"We always get zero down."
"Everyone gets approved."
Those may be convenient sales scripts, but they are not reliable underwriting rules.
Do not promise one universal amount.
Customer contribution varies with the borrower, asset and financing structure.
A strong established business purchasing new mainstream equipment may receive a different structure from a newer company purchasing older specialized equipment.
Trade-in equity can also affect upfront cash.
Canadian customers asking about this can use Mehmi's Equipment Financing Down Payment guide, which explains why upfront requirements function as a risk-management tool rather than one fixed percentage.
For the seller, the safer language is:
"The required upfront amount will depend on the equipment and approved financing structure."
That is both accurate and easier to defend.
Assume a U.S. business purchases equipment from a dealer for USD $100,000.
For illustration only, assume the customer contributes USD $10,000, leaving USD $90,000 financed.
Assume an annual interest rate of 9%, a 60-month term, monthly payments and no lender fee in this simplified example.
The estimated payment is approximately USD $1,868.25 per month.
Over 60 scheduled payments, the customer would repay approximately USD $112,095.12 on the financed amount, including approximately USD $22,095.12 of interest.
Including the USD $10,000 initial contribution, total cash paid toward the equipment and assumed financing would be approximately USD $122,095.12 before excluded expenses.
The example excludes sales tax, insurance, documentation fees, registration costs, freight and other potential charges.
It is not a Mehmi Financial Group offer or indication of currently available pricing.
The important question is whether roughly USD $1,868 per month fits the customer's operating cash flow after payroll, rent, existing debt and normal expenses.
Canadian customers should model the transaction in CAD rather than simply converting the U.S. example. Mehmi's Equipment Financing Calculator allows Canadian businesses to model equipment price, down payment, estimated rate and term. The calculator expressly states that its results are estimates, taxes are excluded and the output is not an approval or financing offer.
Used equipment adds collateral risk.
The financing provider may review operating hours, mileage, service records, equipment condition and recent repairs.
Photos or inspections can become relevant on older assets.
An older machine can also support a shorter term because the lender may not want substantial debt outstanding near the end of the equipment's practical useful life.
Sellers should disclose known equipment information accurately.
Do not replace an approved machine with a substantially older or higher-hour unit and assume the original approval remains valid.
The equipment was part of the underwriting decision.
A customer may also need more cash down on a transaction where purchase price appears high relative to market value.
Potentially.
A customer purchasing a skid steer may also need a bucket, breaker and forks.
A manufacturer buying a CNC machine may need installation and tooling.
A warehouse purchasing forklifts may need chargers and batteries.
Some finance providers can include eligible attachments, freight, installation or other costs in the transaction.
Others may restrict certain soft costs or require the customer to pay them separately.
The seller should therefore itemize these costs instead of hiding them inside one equipment price.
That gives the financing provider the information needed to determine what it will finance.
A trade allowance does not necessarily equal customer equity.
Suppose your dealership values the customer's existing machine at USD $50,000.
If another lender is still owed USD $35,000, the potential gross equity is only USD $15,000 before other adjustments.
Existing security interests need to be addressed before the entire trade value is treated as customer contribution.
In the United States, secured equipment financing can involve a UCC financing statement. California's Secretary of State, for example, explains that Form UCC1 is used to perfect a security interest in named collateral and establish priority in a default or bankruptcy. State filing rules and jurisdiction still depend on the actual transaction.
Do not assume possession proves clear ownership.
Canada uses provincial secured-property systems rather than the U.S. UCC framework.
In Ontario, creditors can register security interests and search for liens through the Personal Property Security Registration system. The Ontario government explains that lenders register financing statements under the PPSA to protect interests in personal property used as loan collateral.
Other common-law provinces use their own PPSA systems.
Quebec uses its civil-law framework and the RDPRM, where registered rights affecting movable property can be searched. Quebec specifically recommends checking the RDPRM when determining whether certain movable assets are subject to debts or hypothecs.
Dealers do not need to become secured-transactions specialists.
They need a funding process that allows the finance provider to complete the appropriate lien and ownership checks before delivery.
Keep sensitive financial data out of informal dealer workflows where possible.
The seller may need basic customer information to introduce the financing request, but bank statements, identification documents and personal credit information should move through the finance partner's secure process rather than being casually forwarded between salespeople.
For Canadian organizations subject to it, PIPEDA sets rules around accountability, consent, limiting collection, limiting use and disclosure, retention and safeguards. Alberta, British Columbia and Quebec also have substantially similar private-sector privacy laws for applicable intraprovincial activity.
A dealer should collect what is necessary for the process, know why it is being collected and avoid retaining sensitive documents longer than required.
Do not assume one dealer-financing process can be copied into every state unchanged.
Commercial financing regulation can be state-specific.
California, for example, requires covered providers making specified commercial financing offers to provide information including the amount of funds provided, total dollar cost, term, payment method and prepayment policies.
California also regulates certain lenders and brokers making or brokering commercial loans, subject to statutory exemptions.
That does not mean every equipment seller automatically becomes a regulated lender.
It means the financing arrangement, the seller's role and the customer's location matter.
Dealers should use approved financing language and processes for the relevant program rather than improvising rate claims, disclosure language or approval promises.
After the financing partner's required closing conditions are satisfied.
Credit approval alone may not be enough.
The provider may still need signed documents, insurance, proof of customer contribution, final serial numbers, lien clearance or delivery confirmation.
A simple internal rule protects the dealership:
Do not release equipment because a customer says, "My financing was approved." Release it according to the financing provider's confirmed funding instructions.
That avoids accidentally turning the dealership into an unsecured creditor.
Look beyond the application link.
Confirm which U.S. states and Canadian provinces the program actually supports.
Ask what equipment categories the provider understands.
Find out how it handles new versus used equipment, private sales, attachments and higher-ticket transactions.
Understand who communicates with the customer, who collects documents and who prepares closing paperwork.
Ask exactly what triggers dealer payout.
Understand what happens when the first lender declines the customer.
And confirm how your company can advertise financing without making unsupported promises.
A co-branded or white-label process is useful only if the underlying credit and payout workflow works.
Mehmi's current North American Vendor Financing Program describes co-branded and white-label options, application tracking, support for new and used equipment, and a dealer payout after a funded transaction.
Yes. A dealer does not need a captive finance company to introduce third-party commercial financing. The right structure depends on the dealer's products, transaction sizes and geography.
No. In a third-party vendor program, an outside lender, lessor or financing brokerage handles the underlying credit and funding.
Potentially. Used assets generally require more attention to age, hours, condition, valuation, ownership and remaining useful life.
Some financing providers support private-sale transactions, but ownership verification, lien searches, equipment inspection and controlled payout can become more important than in a conventional dealer sale.
The financing provider determines approved pricing and terms. Dealers should not promise a rate before the actual financing offer is issued.
Potentially for some customers and assets, but it should not be advertised as universal. Upfront requirements depend on underwriting and structure.
In a normal third-party equipment-financing transaction, the seller is generally paid when the transaction funds and required delivery conditions are satisfied. Confirm the exact payout process in the vendor agreement.
Potentially. Co-branded and white-label programs can keep the dealer's brand prominent while the finance partner handles underwriting and funding. Required disclosures should still accurately identify the relevant parties.
The easiest financing program for a sales team to use is also the simplest.
Quote the equipment accurately.
Ask whether the customer wants financing.
Use a secure application process.
Let the credit team make the underwriting decision.
Complete the funding conditions.
Release the equipment when the transaction is ready.
That gives buyers another way to purchase without forcing your dealership to carry the receivable.
Mehmi Financial Group currently offers a North American Vendor Financing Program for dealers, OEMs and distributors while operating as a financing brokerage/intermediary rather than the direct lender. Actual customer approvals, rates, terms and availability remain subject to independent financing providers and the applicable jurisdiction.
To discuss offering equipment financing to your customers, contact Mehmi Financial Group at 833-863-4644 through the Mehmi Financial Group contact page. The current contact page confirms the toll-free number.
When reaching out, include your typical financing amount, U.S. or Canada, state or province, equipment sold, customer use of the equipment and expected transaction timing so the program can be reviewed against the deals your business actually handles.
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