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Buying used equipment is one of the most effective ways for a growing business to acquire what it needs at a lower cost — but financing terms for used equipment work a little differently than for new. Here's what to expect either way.
How New Equipment Financing Typically Works
New equipment often qualifies for the most favourable financing terms available — sometimes 0% down, longer terms (up to 84 months for larger equipment), and the lowest rates, since the asset is at its full value and expected to hold value predictably over the loan term.
How Used Equipment Financing Typically Works
Used equipment remains widely financeable, but lenders factor in the asset's age, condition, and expected remaining useful life. This can mean a modestly higher down payment requirement, a shorter loan term matched to the equipment's remaining life, and sometimes a slightly higher rate.
Why Used Equipment Can Still Be the Smarter Buy
Even accounting for slightly different financing terms, used equipment's substantially lower purchase price often makes it the more cost-effective choice overall — particularly for equipment types that depreciate quickly in their first few years but remain reliable and useful for a decade or more.
- Lower total purchase price, even with a modestly higher rate
- Faster payback period on the investment
- Often available faster than ordering new equipment
- Well-maintained heavy equipment (construction, agriculture) frequently has a long useful life ahead of it even at 5-10 years old
Getting the Best Terms Either Way
Comparing offers across multiple lenders — as lendflo does across 50+ Canadian lenders — surfaces the best available terms for your specific equipment, whether new or used, rather than accepting the first quote from a single dealer's financing partner.
