Best Construction and Heavy Equipment
Financing Loans

Construction and heavy equipment loans help businesses get the gear they need without having to put all the cash down upfront.

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Best construction and heavy equipment financing loans in 2024

Written by Janet Berry-Johnson | Edited by Kurt Adams and Janet Schaaf | December 28, 2023
How Does LendingTree Get Paid?
LendingTree is compensated by companies on this site and this compensation may impact how and where offers appear on this site (such as the order). LendingTree does not include all lenders, savings products, or loan options available in the marketplace.

How Does LendingTree Get Paid?

LendingTree is compensated by companies on this site and this compensation may impact how and where offers appear on this site (such as the order). LendingTree does not include all lenders, savings products, or loan options available in the marketplace.
LenderUser ratingsBest forLoan amountsTerm lengthMin. interest rate
Bank of America logo
(18)
User Ratings & Reviews rating-reviews-tooltip-icon

Ratings and reviews are from real consumers who have used the lending partner’s services.

Variety of equipment loan optionsFrom $25,000Up to 60 monthsStarting at 7.00%See business loan options
(120)
User Ratings & Reviews rating-reviews-tooltip-icon

Ratings and reviews are from real consumers who have used the lending partner’s services.

Construction businessesFrom $100,000Not disclosedNot disclosedSee business loan options
Taycor Financial lender logo
(155)
User Ratings & Reviews rating-reviews-tooltip-icon

Ratings and reviews are from real consumers who have used the lending partner’s services.

Startup businesses$500 to $2,000,000Up to 84 monthsNot disclosedSee business loan options
User rating coming soonTrucking industryFrom $10,000 to $1,000,000Up to 60 monthsNot disclosedSee business loan options
User rating coming soonLong repayment termsUp to $5,500,000120, 240 or 300 monthsSubject to SBA maximumsSee business loan options
Learn more about how we chose our picks.

Best construction and heavy equipment financing lenders at a glance

Bank of America: Best construction and heavy equipment loan for a variety of equipment loan options

Bank of America logo
Loan amountsFrom $25,000
Starting interest rate7.00%
Term length (months)60 months
Minimum credit scoreNot disclosed
Minimum time in business2 years

Wells Fargo: Best construction and heavy equipment loan for construction businesses

Loan amountsFrom $100,000
Starting interest rateNot disclosed
Term length (months)Not disclosed
Minimum credit score680
Minimum time in businessTwo years

Taycor Financial: Best construction and heavy equipment loan for startup businesses

Taycor Financial lender logo
Loan amounts$500 to $2,000,000
Starting interest rateNot disclosed
Term length (months)84
Minimum credit score550
Minimum time in businessNone

Commercial Fleet Financing: Best construction and heavy equipment loan for the trucking industry

Loan amounts$10,000 to $1,000,000
Starting interest rateNot disclosed
Term length (months)60
Minimum credit score640
Minimum time in businessNot disclosed

U.S. Small Business Administration: Best construction and heavy equipment loan for long repayment terms

Loan amountsUp to $5,500,000
Starting interest rateVaries by month and loan term
Term length (months)120, 240 or 300
Minimum credit scoreN/A
Minimum time in businessTwo years

What are construction and heavy equipment financing loans?

Construction and heavy equipment loans help businesses get the machinery and construction equipment they need.

Unlike traditional business loans, these are tailored to address the unique challenges and requirements of the construction sector.

Since heavy machinery — including cranes, bulldozers, and excavators — is so expensive, it’s often impractical, if not impossible, to purchase equipment outright.

Construction and heavy equipment financing helps your business to lease or buy equipment, converting a significant capital expenditure into manageable monthly payments.

Financing vs. leasing: Heavy equipment and construction loans

When acquiring equipment, businesses often have two options: equipment financing or equipment leasing. Financing, also called an equipment loan, allows you to purchase the equipment but pay for it in monthly installments. Once the loan is paid off, your business owns the equipment free and clear, and it becomes an asset on your company’s balance sheet.

On the other hand, leasing is akin to renting the equipment for an extended timeframe. At the end of the lease term, your business may have the option to return the equipment, purchase it (often at a reduced price) or renew the lease.

Heavy equipment financingHeavy equipment leasing
Monthly payments?HigherLower
Monthly payment costs?Fixed principal plus interest paymentsFixed lease payment
Depreciation is tax deductible?May be tax deductible*Not tax deductible
Can I trade in equipment or does it become outdated?May become outdatedCan trade in

*This is not tax advice. Consult with a CPA to determine the best options for you and your business.

How to get a construction and heavy equipment financing loans

Here’s how to get a business loan for construction or equipment:

  1. Assess your needs and budget. Before diving into the application process, take a moment to evaluate what kind of equipment you need and how it fits your business operations. Consider things like the lifespan of the equipment, how often you will use it and the return on investment you expect it to bring.
  2. Get the essential documents ready. Most lenders have requirements for business loans that include a range of documents to assess your financial health and the viability of the loan. Commonly requested documents include financial statements, tax returns and bank statements.
  3. Research and choose the best lender. Not all lenders are created equal. Research your options, including banks, credit unions and specialized equipment financing companies. Look for those that offer favorable terms, understand the construction industry and have positive reviews or customer testimonials.
  4. Submit your application. Once you’ve chosen a lender, begin the application process. This may involve filling out an online application or working directly with a loan officer at a local branch office. Be thorough and accurate in providing information, as discrepancies can delay or jeopardize your approval.
  5. Review terms and finalize the deal. If your application is approved, you’ll receive an offer detailing the loan’s terms, including business loan interest rates, repayment schedule and associated fees. Review these terms carefully. If everything appears satisfactory, sign the loan agreement.

Pros and cons of construction and heavy equipment financing loans

ProsCons

  Improved cash flow

  Access to advanced equipment

  Potential tax write-offs

  Higher overall costs due to interest

  Some lenders may require additional collateral

  Locked into a repayment schedule

How we chose the best construction and heavy equipment financing loans

We reviewed more than 15 lenders to determine the overall best six construction and heavy equipment financing loans. To make our list, lenders must meet the following criteria:

  • Minimum time in business: We prioritized lenders who had worked with businesses in operation two years or less.
  • Minimum credit score: While the lenders on this list cater to a variety of credit profiles, we prioritized lenders who had a minimum credit score requirement of 680 or lower or had no credit score requirement.
  • Rates and terms: We prioritize lenders with more competitive fixed rates, fewer fees and greater options for repayment terms, loan amounts and APR discounts.
  • Repayment experience: For starters, we consider each lender’s reputation and business practices. We also favor lenders that report to all major credit bureaus, offer reliable customer service and provide any unique perks to customers, like free wealth coaching.

Best construction and heavy equipment financing loans summary

Frequently asked questions

Heavy equipment financing allows businesses to purchase essential equipment without bearing the full cost upfront. The business gets a loan to buy the equipment and agrees to a structured repayment plan — typically involving monthly installments.

The credit score needed to finance a heavy equipment purchase varies based on the lender and the specific financing program. Generally, a higher credit score increases the likelihood of securing favorable loan terms and lower interest rates. Many lenders prefer borrowers to have a credit score of at least 640. However, even if you have a lower credit score, some lenders offer equipment loans for bad credit. If you have poor credit, lenders may be more open to considering your application if you make a down payment.

The length of time for a construction and heavy equipment loan varies depending on the lender. Many lenders offer loan terms of up to five years. However, the SBA’s 504 loan program provides loans for 10, 20 or 25 years.

Whether you should finance construction and heavy equipment depends on your business’s financial situation, operational needs and long-term goals. Financing can be a good choice for businesses that want to preserve cash flow and acquire state-of-the-art equipment without large upfront costs. On the flip side, financing can result in higher total costs after factoring in interest and potential fees. So, it’s essential to weigh the benefits of owning the equipment sooner against the commitment and costs associated with a financing agreement.