Equipment Financing Rates
See What Rate You Qualify For
Axiant Partners works with lenders across all credit tiers. Excellent credit borrowers regularly qualify for 5–8% APR. Even fair-credit borrowers can access equipment financing. Terms 36–84 months.
- ✓ Excellent credit: 5–8% APR
- ✓ Good credit: 8–12% APR
- ✓ All equipment types and brands
- ✓ New and used equipment
- ✓ Decision in 24–48 hours
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Equipment Financing Rates 2026 — Complete Rate Guide
Current interest rate ranges by credit tier, equipment type, and loan term. OEM 0% programs, SBA rates, and a full rate matrix to benchmark any deal.
Key Facts: Equipment Financing Rates 2026
- Best Available Rate: 5–6% APR (680+ FICO, 3+ years in business, new equipment)
- Average Market Rate: 8–12% APR (640–679 FICO, established business)
- Used Equipment Premium: +1–3 percentage points vs. identical new equipment
- OEM 0% Programs: Available from Cat Financial, John Deere Financial, CNH, Bobcat Financial — limited time, strong credit required
- SBA 7(a) Rate Cap: Prime + 2.75% (approx. 10–11% in 2026)
- Startup Premium: +3–8 percentage points for businesses under 2 years old
- Rate Quote vs. APR: Always compare APR — some lenders quote simple interest rates that are lower than the effective APR
Equipment Financing Rates by Credit Tier (2026)
Credit score is the single most important factor in equipment financing rates. Lenders use the personal FICO score of the business owner (or all owners with 20%+ stake) as the primary underwriting anchor, supplemented by business credit, time in business, and revenue. The four tiers below represent typical ranges for established businesses (2+ years old) financing new equipment.
| Credit Tier | FICO Range | Typical Rate Range | Down Payment | Max Term | Profile |
|---|---|---|---|---|---|
| Excellent | 720+ | 5–7% APR | 0% available | 84 months | Best rates, all lenders compete |
| Very Good | 680–719 | 6–8% APR | 0–10% | 72–84 months | Strong approval odds, low rates |
| Good | 640–679 | 8–12% APR | 5–15% | 60–72 months | Standard commercial rates |
| Fair | 600–639 | 12–18% APR | 10–20% | 48–60 months | Limited lenders, higher cost |
| Poor | 580–599 | 18–24% APR | 15–25% | 36–48 months | Specialty lenders only |
| Bad | Below 580 | 24–28%+ APR | 20–30%+ | 24–36 months | Very limited options, high cost |
These ranges apply to established businesses (2+ years, $250,000+ annual revenue) financing new or near-new equipment. Startups, businesses with tax liens, recent bankruptcies, or very low revenue will see rates at the upper end or beyond these ranges. For more on credit requirements, see our Equipment Financing Credit Requirements guide.
Rate Impact: Real Dollar Examples
To understand what rate differences mean in practice, consider a $100,000 equipment loan over 60 months:
| Rate (APR) | Monthly Payment | Total Interest Paid | Total Cost | vs. Best Rate |
|---|---|---|---|---|
| 5% | $1,887 | $13,227 | $113,227 | Baseline |
| 8% | $2,028 | $21,659 | $121,659 | +$8,432 |
| 12% | $2,224 | $33,467 | $133,467 | +$20,240 |
| 18% | $2,539 | $52,336 | $152,336 | +$39,109 |
| 24% | $2,877 | $72,633 | $172,633 | +$59,406 |
| 28% | $3,101 | $86,071 | $186,071 | +$72,844 |
The difference between a 5% rate and an 18% rate on a $100,000 loan is over $39,000 in total interest over 5 years — a compelling reason to work on your credit profile before applying. See our guide on improving your credit for equipment financing for actionable steps.
Equipment Financing Rates by Equipment Type
Beyond credit score, the type of equipment significantly affects rates. Lenders factor in ease of repossession, depth of the secondary market, and typical depreciation curves when pricing equipment loans. Equipment with deep liquid secondary markets (agricultural, construction) gets better rates than equipment with thin used markets (restaurant, specialty industrial).
| Equipment Category | Rate Modifier | Reason | Example Equipment |
|---|---|---|---|
| Agricultural Equipment | Base to -0.5% | Deep auction market, strong NADA values | Tractors, combines, planters |
| Construction Equipment | Base rate | IronPlanet/Ritchie Bros. provide strong comps | Excavators, loaders, graders |
| Transportation/Trucking | Base to +0.5% | Well-understood market, quick repossession | Semi trucks, dump trucks |
| Medical Equipment | Base to +1% | Good collateral but installation-dependent | Imaging, surgical, dental |
| Manufacturing Equipment | +0.5% to +2% | Specialty use limits resale pool | CNC machines, presses, robots |
| Restaurant Equipment | +2% to +4% | Built-in, hard to repossess, grease-damaged | Ovens, hoods, refrigeration |
| Forestry Equipment | +1% to +2% | Remote locations, specialized market | Feller bunchers, skidders |
| IT/Technology | +1% to +3% | Rapid depreciation, obsolescence risk | Servers, network equipment |
Full Rate Matrix: Equipment Type × Credit Tier
The table below combines credit tier and equipment type to give a comprehensive rate picture. These are typical APR ranges for established businesses (2+ years) financing new equipment with standard terms.
| Equipment Type | Excellent (680+) | Good (640–679) | Fair (600–639) | Bad (<600) |
|---|---|---|---|---|
| Agricultural (new) | 5–7% | 7–10% | 11–16% | 17–24% |
| Agricultural (used, <10 yrs) | 6–9% | 9–13% | 13–19% | 20–27% |
| Construction (new) | 5–8% | 8–12% | 12–18% | 18–26% |
| Construction (used, <15 yrs) | 7–10% | 10–14% | 14–20% | 20–28% |
| Medical (new) | 6–8% | 8–12% | 13–18% | 18–26% |
| Transportation/Trucks (new) | 5–8% | 8–12% | 12–18% | 18–26% |
| Manufacturing (new) | 6–9% | 9–13% | 14–19% | 20–28% |
| Restaurant (new) | 8–11% | 11–15% | 16–22% | 22–28%+ |
| IT/Technology (new) | 7–10% | 10–14% | 15–21% | 22–28%+ |
New vs. Used Equipment Rate Premium
Used equipment consistently commands a rate premium of 1–3 percentage points compared to equivalent new equipment. This premium exists because:
- Collateral risk: Used equipment has already depreciated and carries unknown maintenance history, increasing lender recovery risk.
- Valuation uncertainty: New equipment has a defined MSRP; used equipment requires appraisal, NADA check, or auction comparable analysis.
- Age limits: Most lenders have maximum age restrictions (construction: 15 years, ag: 10 years, medical: 7 years). Equipment approaching these limits may face larger premiums or require additional documentation.
- Inspection requirements: Loans on used equipment over $50,000 often require a third-party inspection report, which adds cost and time.
For a complete breakdown of used equipment financing requirements, see our Used Equipment Financing Guide.
How Loan Term Affects Rate
Loan term has a moderate but real effect on equipment financing rates. Longer terms carry slightly higher rates because lenders bear more time-based risk (business failure, collateral depreciation, rate environment changes). The typical premium for extending from a 48-month to a 72-month term is 0.5–1.5 percentage points.
| Loan Term | Typical Rate Adjustment | Monthly Payment (on $100K @ base 7%) | Total Interest |
|---|---|---|---|
| 24 months | Base - 0.5% | $4,479 | $7,491 |
| 36 months | Base rate | $3,088 | $11,166 |
| 48 months | Base + 0.25% | $2,413 | $15,836 |
| 60 months | Base + 0.5% | $1,980 | $18,797 |
| 72 months | Base + 1% | $1,723 | $24,068 |
| 84 months | Base + 1.5% | $1,565 | $31,437 |
Shorter terms save significant interest but require higher monthly payments that must be supported by the equipment's revenue generation. For equipment with long useful lives (large agricultural or construction equipment), longer terms often make business sense despite higher total cost.
OEM Promotional Rates — 0% Programs
Original Equipment Manufacturers run periodic 0% or sub-market promotional financing programs through their captive finance subsidiaries. These are funded by the OEM — the manufacturer subsidizes the difference between the promotional rate and market rate, effectively reducing the purchase price. These programs are legitimate and transparent.
| OEM Lender | Brands Covered | Typical Promo Structure | Credit Requirement | Availability |
|---|---|---|---|---|
| Caterpillar Financial | Cat, Perkins | 0% for 36–48 months, new equipment | 680+ FICO | Seasonal, limited inventory |
| John Deere Financial | John Deere | 0% for 36–60 months (ag), seasonal promos | 680+ FICO | Strong ag promotion calendar |
| CNH Industrial Capital | Case, New Holland | 0–1.9% for 36–48 months | 660+ FICO | Seasonal, model year transitions |
| Bobcat Financial Services | Bobcat | 0% for 36–48 months on select models | 680+ FICO | Periodic, aligned with trade shows |
| Komatsu Financial | Komatsu | Low-rate promos, rarely 0% | 680+ FICO | Less frequent than Cat/Deere |
| Volvo Financial Services | Volvo CE | 1.9–2.9% for 36–48 months | 660+ FICO | Periodic |
OEM 0% programs apply only to new equipment purchased from authorized dealers. Used equipment, off-brand alternatives, and private sales are not eligible. For qualifying borrowers, these programs represent the lowest possible equipment financing cost. For details on eligibility, see our guide on No Money Down Equipment Financing.
SBA 7(a) vs. Conventional Equipment Loan Rates
The SBA 7(a) program is a government-backed small business loan program that can be used to finance equipment. SBA rates are regulated with caps, but they are not always cheaper than conventional equipment financing for well-qualified borrowers.
| Criteria | SBA 7(a) | SBA 504 | Conventional Equipment Loan |
|---|---|---|---|
| Rate Type | Variable: Prime + 2.75% max | Fixed: Below market | Fixed or variable, market-based |
| Rate (approx. 2026) | 10–11% | 6–7% (CDC portion) | 5–15% depending on credit |
| Max Term (equipment) | 10 years | 20 years | 5–7 years (most lenders) |
| Down Payment Required | 10% equity injection | 10% borrower | 0–20% (credit-dependent) |
| Loan Size | $150K–$5M | $250K+ | $10K–$5M+ |
| Approval Timeline | 3–6 months | 3–6 months | 24–72 hours |
| Paperwork Burden | High (SBA forms, tax returns, projections) | Very high | Low to moderate |
| Personal Guarantee | Required (all 20%+ owners) | Required | Required (usually) |
| Best For | Longer terms, weaker credit | Large equipment, job creation | Speed, simplicity, strong credit |
For most well-qualified borrowers (680+ FICO, 2+ years in business), conventional equipment financing is faster, simpler, and often cheaper than SBA. SBA programs shine for borrowers who need 10-year terms to keep payments manageable, or who are borderline for conventional approval. For more context, see our full Equipment Financing vs. SBA Loan comparison.
What Actually Drives Your Rate: A Lender's Perspective
Understanding how lenders price equipment loans helps you negotiate better. Lenders build rates from several components:
- Cost of funds: What the lender pays to borrow money (tied to Treasury yields, prime rate, SOFR). This is the floor below which no lender will go.
- Credit risk premium: Added based on your credit score, time in business, and business financials. This is the largest variable component.
- Collateral discount: Lenders add margin based on how recoverable the equipment is. New Cat excavator = low discount; custom restaurant hood = high discount.
- Term premium: Longer terms = higher rates because of extended risk exposure.
- Origination and processing fees: Some lenders bundle fees into the rate; others charge them separately. Always ask for the APR including all fees.
- Lender margin/profit: Generally 1–3% depending on the lender's business model.
How to Get the Best Equipment Financing Rate
Several strategies consistently produce lower rates for equipment buyers:
- Improve credit before applying: Even moving from 639 to 641 crosses a tier boundary and can save 3–4 percentage points. Pay down revolving credit to below 30% utilization. Dispute errors. Give yourself 90 days of credit work before applying for large loans.
- Show strong business financials: Lenders want to see 1.25x+ DSCR (debt service coverage ratio). If your business generates $150,000 in annual profit and the new loan adds $24,000/year in payments, your DSCR is 6.25x — excellent. Weak DSCR triggers rate increases even with good credit.
- Finance new equipment from recognized brands: Cat, John Deere, Komatsu, Bobcat, and Deere get the best collateral pricing. Generic or obscure brands may add 1–2% to your rate.
- Time your purchase to catch OEM promotions: John Deere's spring planting promotions and Cat's year-end programs can deliver 0% or near-0% rates that no independent lender can match.
- Apply with multiple lenders: Equipment financing rate shopping within a 30-day window typically counts as one credit inquiry. Getting 3–5 quotes is standard and does not meaningfully hurt your credit score.
For more information on how equipment loans work, including the application process and documentation requirements, see our guide on How Commercial Equipment Financing Works. For tax benefits that reduce the effective cost of equipment financing, see our Section 179 Equipment Deduction guide.
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Frequently Asked Questions — Equipment Financing Rates 2026
What is a good equipment financing rate in 2026?
A good equipment financing rate in 2026 is 5–8% APR for borrowers with excellent credit (680+ FICO) and 2+ years in business. Rates of 8–12% are considered average for good credit (640–679 FICO). Anything above 15% is considered high and typically applies to borrowers with fair credit (600–639) or businesses under 1 year old. Rates above 20% are generally only for bad credit (below 600) or very high-risk situations.
How much does credit score affect equipment financing rates?
Credit score has the single largest impact on equipment financing rates. Moving from the fair tier (600–639, rates 12–18%) to the good tier (640–679, rates 8–12%) can save 4–6 percentage points. On a $150,000 equipment loan over 60 months, a 5-point rate difference saves approximately $22,000 in total interest. Lenders also look at business credit (Dun & Bradstreet Paydex score), time in business, and revenue — but personal FICO is often the dominant factor for loans under $250,000.
Do equipment type and age affect the interest rate?
Yes. Equipment type and age both affect rates. Agricultural equipment and medical equipment often qualify for the lowest rates due to strong collateral recovery. Restaurant equipment typically carries higher rates (+2–4%) because it's harder to repossess and resell. Used equipment adds 1–3 percentage points to the rate vs. identical new equipment, reflecting the higher collateral risk from depreciation and unknown maintenance history. Equipment over 10 years old may face an additional premium or be declined by some lenders.
What is the difference between APR and a factor rate for equipment financing?
APR (Annual Percentage Rate) is the annualized cost of borrowing including interest and fees — it accounts for the amortizing nature of the loan. A factor rate is a multiplier used by some online/fintech lenders: you multiply the loan amount by the factor (e.g., 1.25) to get total repayment. A 1.25 factor rate on a 12-month loan equals approximately 45–50% APR. Always convert factor rates to APR before comparing to traditional lender quotes. Most traditional equipment lenders quote APR, not factor rates.
Can I get 0% equipment financing in 2026?
Yes, but 0% OEM promotional financing is limited to specific brands, models, and time windows. Caterpillar Financial, John Deere Financial, CNH Industrial Capital, and Bobcat Financial Services all run periodic 0% programs — typically 0% for 36–48 months on new equipment purchased from an authorized dealer. These require strong credit (680+ FICO), down payment (sometimes 0%, sometimes 10%), and apply only to qualifying new inventory. The OEM subsidizes the rate difference, so these programs are legitimate and not artificially inflated purchase prices.
How do SBA 7(a) loan rates compare to conventional equipment financing rates?
SBA 7(a) loans for equipment are capped at Prime + 2.75% (for loans over $50,000), which in 2026 works out to approximately 10–11% depending on the current prime rate. Conventional equipment loans for good-credit borrowers can be 5–9%, meaning conventional is often cheaper for well-qualified borrowers. The SBA advantage is longer terms (up to 10 years for equipment vs. 5–7 years conventional), lower monthly payments, and availability for borrowers who can't get conventional financing. The SBA disadvantage is the 3–6 month approval process and heavy paperwork.