Sale-Leaseback on Equipment in Canada

Keeping crews moving while cash is tight is the balancing act of Canadian operators. Payroll, fuel, parts, and a new contract can’t wait for slow approvals. If you own trucks or equipment free and clear (or with meaningful equity), a sale-leaseback can turn that equity into cash in days—while you keep using the asset. As both a financing partner and a seller of commercial trucks and heavy equipment, Mehmi Financial Group structures fast, transparent sale-leasebacks across Canada, often funding within 24–48 hours for deal-ready files through our network of 30+ lenders or via our in-house programs. If you want a quick read on what your equipment could unlock, feel free to contact our credit analysts.

Are you looking for a truck? Look at our used inventory.

What a Sale-Leaseback Is (Plain English)

You sell your owned equipment to a lender and immediately lease it back. You receive a lump-sum cash injection today; you keep possession and continue using the asset; you make lease payments over a set term; and you retain a clear path to ownership at the end (e.g., $10 buyout or similar). It’s asset-based financing that starts with the value and marketability of the equipment, not just your financial statements.

Explore our program overview: Refinancing & Sale-Leaseback.

When a Sale-Leaseback Beats a Traditional Loan

• Speed matters: You need cash in days, not weeks—payroll, deposits, or a time-sensitive contract.
• Cash-flow dips or slow-pay customers: Your statements are fine annually but lumpy monthly.
• Limited bank appetite: Thin credit, recent hiccups, or you simply want to keep bank lines clean.
• You want to keep working: Selling the unit outright would stall operations; a leaseback avoids downtime.
• Raising the down payment: Use a leaseback on one asset to fund the down on your next purchase.

If you’re still weighing options, see our general guide: Financing & Leasing and our explainer: Understanding the Basics of Truck Loans.

What Lenders Actually Underwrite

As credit analysts, we see decisions hinge on four levers:

• Asset strength: Year, hours/kilometres, make/model, maintenance history, and resale value.
• Equity position: Unencumbered or low remaining balance after payout.
• Capacity: Bank deposits comfortably covering the proposed payment alongside fuel, payroll, and insurance.
• Deal structure: Term length, residual, security (additional assets, guarantees), and your operating story.

If receivables are the bottleneck, pairing your leaseback with Invoice Factoring can normalize weekly deposits and improve pricing.

How the Money Flows (Step-by-Step This Week)

Day 1 — Discovery & valuation:
We review the equipment list (VIN/serials, photos, hours), recent bank statements, and your cash-need timeline. We provide a working valuation range and payment estimate using our Calculator.

Day 2 — Conditional approval:
We confirm term, residual, any payouts to clear liens, and insurance. If helpful, we can also align a small Line of Credit & Working Capital to cover fuel or parts.

Day 2–3 — Docs & funding:
Bill of sale to lender, PPSA registration, inspection if required, insurance binder, and funding release. You keep the asset in service the entire time.

Need a larger capital stack? We regularly combine leasebacks with new-equipment acquisitions from our lot. Are you looking for a truck? Browse our used inventory and we’ll structure both sides together.

Typical Structures We See Funded

• $1 or $10 buyout leaseback (36–60 months): Predictable path back to ownership.
• FMV leaseback with lower payment: Useful for seasonal businesses with uneven months.
• Portfolio leaseback: Multiple units (e.g., tractors + trailers) pooled to raise a larger lump sum.
• Top-up for down payment: Leaseback on a second asset to fund the down on a purchase you’re making now.

What You’ll Need (Short Checklist)

• Equipment list with VIN/serials, photos, and location.
• Payout statements (if any liens) and ownership docs.
• 3–6 months of business bank statements (personal if new).
• Proof of insurance (binder before funding).
• Basic application, ID, and void cheque.
• Optional but helpful: service records, appraisal/inspection, contract letters.

If paperwork’s a barrier, feel free to contact our credit analysts—we’ll sequence the checklist and pre-package your file for a faster yes.

Cost, Pricing, and How to Keep It Competitive

Pricing on leasebacks reflects asset quality and risk. To earn the best structure:

• Present clean statements: Minimize NSFs 60–90 days prior to submission.
• Choose the right term/residual: Shorter terms and meaningful residuals reduce risk and total cost.
• Bundle smartly: Pair with Invoice Factoring to stabilize cash or with a small Line of Credit for running costs.
• Use realistic valuations: Over-inflating hurts approvals; we’ll provide a grounded market range.

Run first-pass math with our Calculator to align payment comfort before we finalize structure.

Quick Comparison: Which Funding Tool Fits?

For a deeper primer on your alternatives, see:

• Refinancing & Sale-Leaseback
• Financing & Leasing
• Invoice Factoring for Truckers: Get Paid Faster and Improve Cash Flow
• 2025 Equipment Financing Options for Small Businesses in Ontario

Case Study: “We Met Payroll and Kept the Contract”

Profile: Ontario fleet with 7 tractors and 10 trailers; growth spiked after landing a retail distribution lane.
Challenge: Cash gap ahead of start date—hiring drivers, fuel float, and parts needed immediately; bank line was tapped.
Structure: Portfolio sale-leaseback on three trailers + one tractor, 48-month term, $10 buyout, paired with a modest Line of Credit & Working Capital.
Outcome: Funds wired within three business days of inspection and binder. Team hit the lane start date, collected first invoices two weeks later, and normalized cash flow using light Invoice Factoring for the first 60 days.

Practical Tips From a Credit Analyst

• List every asset with serials early: Surprises in lien searches slow deals.
• Time insurance and inspections: Pre-book both so funding doesn’t slip by a day.
• Budget soft costs: Tires, transport, small repairs—either plan cash or ask what can be included.
• Don’t shop five brokers: Duplicate submissions create conflicts; pick one accountable partner.
• Think ahead: If you’ll buy another unit soon, use this leaseback to create the down and clean up statements first.

Why Operators Choose Mehmi Financial Group

• Seller + Financier: We carry inventory of used Class 8 trucks, trailers, and commercial assets—and can finance them directly.
• Speed & Certainty: Approvals commonly within 24–48 hours for complete files, up to $5M across lenders.
• Breadth: Transportation, construction, food service, medical, manufacturing, and more.
• Flexible structures—even for newcomers or past credit challenges. We design to your realities, not a template.

Explore solutions:
Refinancing & Sale-Leaseback • Financing & Leasing • Invoice Factoring • Line of Credit & Working Capital • Calculator

Frequently Asked Questions

How fast can a sale-leaseback fund in Canada?
For deal-ready files (valuation complete, clean titles or payouts known, insurance lined up), conditional approvals are possible within 24–48 hours, with funding upon inspection and binder. Timing depends on asset type and readiness of documents.

Do I lose my equipment during the process?
No. You keep possession and continue operating. Title moves to the lender during the lease term; you lease it back and typically have a small buyout at the end.

What equipment qualifies?
Marketable assets with clear serials and resale value: tractors, trailers, dump trucks, construction equipment, forklifts, select manufacturing machinery, and more. We’ll confirm fit during discovery.

What if I still owe money on the asset?
We can often pay out the existing lien at funding and lease back the equipment against the remaining equity. Send your payout statement and we’ll model it.

How big a lump sum can I raise?
It depends on asset value and risk tier. We routinely structure from $50,000 up to multi-million portfolios. Use the Calculator for a quick sense of payment.

Can a sale-leaseback help me qualify for new equipment?
Yes. Many clients use the leaseback to raise the down payment and clean up bank statements before applying for a purchase—either from our inventory or elsewhere.

Ready to turn your equipment into working capital—without parking it? Feel free to contact our credit analysts for a fast, honest assessment: Contact Us. If you’d like to ballpark payments first, try our Calculator.

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