Construction equipment financing covers the full contractor fleet: excavators ($30K–$500K+), bulldozers ($150K–$800K), wheel loaders ($100K–$400K), skid steers and compact track loaders ($30K–$80K), backhoe loaders ($80K–$150K), articulated dump trucks ($400K–$700K), motor graders ($250K–$500K), pavers and compactors ($50K–$300K). Financing runs 6–12% APR over 36–72 month terms with 0–20% down at 600+ FICO. OEM captives (Cat Financial, John Deere Financial, Komatsu Financial, Volvo Construction) often beat third-party rates by 1–2% on new equipment.
Construction equipment is one of the largest categories in equipment financing, driven by infrastructure spending, residential and commercial construction cycles, and demolition + site-prep volume. The four major OEMs — Caterpillar, John Deere, Komatsu, Volvo Construction Equipment — dominate the market with strong captive financing programs that compete hard with third-party lenders. This guide covers what construction equipment financing looks like by class, the loan-vs-lease question, and how to think about OEM captive vs specialty lender pricing. For the broader hub see equipment financing.
Cost Ranges by Equipment Class
| Equipment | New | Used (3–5 yr) |
|---|---|---|
| Mini excavator (1–8 ton) | $30K–$90K | $15K–$55K |
| Mid-size excavator (10–25 ton) | $90K–$220K | $50K–$140K |
| Large excavator (30–90 ton) | $250K–$500K+ | $130K–$320K |
| Small dozer (D3–D6) | $150K–$350K | $80K–$220K |
| Large dozer (D8–D11) | $400K–$800K | $220K–$500K |
| Wheel loader | $100K–$400K | $50K–$240K |
| Skid steer + compact track loader | $30K–$80K | $15K–$50K |
| Backhoe loader | $80K–$150K | $40K–$90K |
| Articulated dump truck | $400K–$700K | $220K–$450K |
| Motor grader | $250K–$500K | $120K–$320K |
Major Brands & OEM Captives
- Caterpillar — market leader; Cat Financial Services is the captive. Often runs 0%, 1.99%, or 2.99% promotional rates on new equipment 2–4 times per year.
- John Deere Construction & Forestry — John Deere Financial captive. Strong on excavators and skid steers.
- Komatsu — Komatsu Financial. Strong on large excavators and articulated trucks.
- Volvo Construction Equipment — Volvo Financial Services. Strong on wheel loaders and articulated trucks.
- Hyundai Construction Equipment, Hitachi, Doosan, Kobelco, JCB — smaller market shares but competitive captive financing programs.
- Bobcat (Doosan brand) — dominates the compact equipment segment.
Third-Party Lenders
- PEAC Solutions (formerly Marlin Capital) — heavy equipment specialty
- Wells Fargo Equipment Finance — generalist with strong construction experience
- Pawnee Leasing — flexible on used + challenged credit
- Stearns Bank — broad equipment, fast approval
- Live Oak Bank — SBA-experienced on $500K+ deals
- Beacon Funding, Mission Financial, Currency Capital — specialty construction equipment lenders
Loan vs Lease for Construction Equipment
- Equipment loan (36–72 mo, 6–12% APR, 0–20% down): owned at end, Section 179 + bonus depreciation in year one. Best when running equipment 8–12 year useful life.
- $1 buyout lease (similar economics to loan): treated as financed purchase for tax. Section 179 + bonus depreciation apply.
- Operating lease (36–60 mo): lower monthly than loan, no end-of-term ownership, fully deductible lease payment. Best for 3–5 yr refresh cycles.
- Rental: not financing — pay daily/weekly/monthly rates. United Rentals, Sunbelt Rentals, Herc Rentals dominate. Right answer for low-utilization or project-specific equipment.
Next Step
Get matched with construction equipment lenders — OEM captives, specialty heavy-equipment, and generalist in one application. See also typical equipment financing rates and equipment lease vs loan vs cash.
A worked example: financing an excavator
Take a contractor financing a $120,000 mid-size excavator with 10% down, leaving $108,000 over 60 months. At roughly 8% APR the payment is about $2,190 a month — readily covered when the machine is billing on active jobs most weeks. OEM captives like Cat Financial sometimes run promotional 0% or low-rate offers on new equipment that can beat a third-party loan, so it is worth pricing the captive against a specialty heavy-equipment lender. Buying used — a 3–5 year-old machine at 40–60% of new — lowers the financed amount, with lenders weighing machine hours much like mileage.
Frequently Asked Questions
Can you finance construction equipment like excavators and dozers?
Yes. OEM captives (Cat Financial, John Deere, Komatsu), banks, and specialty heavy-equipment lenders all finance excavators, dozers, loaders, and more, typically over 36–72 months.
Is it cheaper to finance through an OEM captive or a third-party lender?
It depends. Captives sometimes run promotional 0% or low-rate offers on new machines that beat third-party pricing, while specialty lenders are often more flexible on used equipment and tougher credit. Price both.
Can I finance used construction equipment?
Yes. Used excavators and dozers hold value and finance well; lenders weigh machine hours, age, and condition, so a lower-hour, well-maintained machine earns better terms.
How much down payment for construction equipment?
Commonly 0–20%, with strong credit and new equipment at the low end and used machines or newer businesses toward the higher end. Section 179 expensing often applies in the purchase year.
Frequently Asked Questions
How much does construction equipment cost?
Wide range by class. Excavators (mini through large): $30K–$500K+. Bulldozers: $150K–$800K. Wheel loaders: $100K–$400K. Skid steers + compact track loaders: $30K–$80K. Backhoe loaders: $80K–$150K. Articulated dump trucks: $400K–$700K. Motor graders: $250K–$500K. Pavers + compactors: $50K–$300K. Most growing construction contractors finance the full fleet.
What credit score is needed for construction equipment financing?
600+ FICO qualifies most established contractors. 680+ gets best rates. Specialty heavy-equipment lenders are flexible if the contractor has 2+ years operating + active contracts. New contractors with under 1 year operating typically need 25–30% down or a stronger personal credit anchor. OEM captive programs (Cat Financial, John Deere Financial, Komatsu Financial) often beat third-party rates on new equipment.
Should I buy or rent construction equipment?
Buy if utilization is 70%+ across the equipment's useful life. Equipment used 200+ days per year pays back the financing cost vs renting. Rent if utilization is under 50% or the equipment is for a specific project. Most established contractors own their core fleet (high-utilization machines) and rent peak-season or specialty equipment from a major rental house (United Rentals, Sunbelt Rentals, Herc Rentals).
Can I finance used construction equipment?
Yes — most lenders finance used construction equipment up to 8–12 years old at similar rates to new with a 12-month dealer warranty. Auction purchases (Ritchie Bros, IronPlanet) finance but usually require 20–25% down. The equipment's hour meter, service history, and inspection report drive financing approval — lenders check these as carefully as the year-of-manufacture.
How do construction equipment financing rates compare to other equipment?
Construction equipment runs 6–12% APR in 2026 — comparable to most general equipment financing. OEM captive programs (Cat Financial, John Deere Financial) often beat third-party by 1–2%, especially on new equipment with promotional 0% or 1.99% offers. The premium over absolute floor rates reflects the equipment's exposure to construction-cycle volatility — recessions hit construction first.