Contractor equipment financing approves at 550-600+ FICO, 6+ months in business, and $10K+ monthly revenue. Decisions hit in 24-72 hours. Rates run 8-15% APR with 0-20% down. Most contractor assets — skid steers, backhoes, trailers, lifts — finance with strong resale markets and looser credit boxes than unsecured loans.
Contractor equipment financing is asset-backed lending for the working iron contractors actually buy: skid steers, backhoes, trailers, scissor lifts, telehandlers, trenchers, work trucks. The credit boxes run looser than for unsecured working capital because the equipment itself secures the loan. This guide covers what general, electrical, plumbing, HVAC, and concrete contractors see when financing equipment under $250K. For the broader product overview see equipment financing; for related industry context see construction business financing.
What Contractors Actually Finance
The dominant categories: skid steers and compact track loaders (CTLs), mini excavators, backhoes, scissor and boom lifts, telehandlers, trenchers, dump trailers, equipment trailers, work trucks (Class 3-5), generators, compressors, concrete mixers, finishers, screeds, and powered specialty tools with serial numbers. Bobcat, Cat, Kubota, John Deere, Case, JLG, Genie, Skyjack, Toro, and Vermeer are the brand spine.
Things that do not finance through this channel: hand tools, ladders, small generators under $5K, computers, software. Those go on a business credit card or a working capital line. The bright line is whether the asset has a serial number, a five-figure-plus price, and an active resale market.
Contractor-Specific Credit Boxes
| Profile | FICO | TIB | Down |
|---|---|---|---|
| A paper | 720+ | 2+ years | 0-10% |
| B paper | 660-719 | 1-2 years | 5-15% |
| C paper | 600-659 | 6 months-1 year | 10-20% |
| Specialty / startup | 550-599 | 3-6 months | 15-25%+ |
Credit boxes are softer for contractors than for retail/restaurant borrowers because lenders see contractor revenue as recession-resistant: when residential slows, commercial picks up, and vice versa. The flip side is that contractor revenue is bumpy, so deposit consistency in bank statements matters more than peak revenue.
By Trade: What You Actually Need
General contractors / site work
Skid steers, mini excavators, dump trailers, work trucks. Average ticket $40K-$120K. Five-year terms common. Strong-brand iron (Bobcat, Cat, Kubota) finances at A-tier rates with steady deposits.
Electrical contractors
Trenchers, generators, lifts, work trucks, conduit benders. Tickets run $20K-$80K. Lifts (scissor and boom) finance through specialty lift lenders that price aggressively for steady-renting contractors.
Plumbing & mechanical
Sewer cameras, jetting trucks, work trucks, pipe locators, mini excavators for service work. Sewer trucks ($60K-$150K) finance under specialty programs because they are vocational vehicles with deep resale.
HVAC
Service vans, work trucks, lifts (for rooftop work), recovery equipment, vacuum pumps. Service van fleets often refinance under fleet programs for better rates than per-unit deals.
Concrete contractors
Mixers, finishers, screeds, line stripers, saws, pumps, work trucks. Concrete pumps ($150K-$500K) finance through specialty lenders given the asset class and operator skill required.
Documentation: The Fast Path
For deals under $150K, contractors typically need:
- Equipment invoice with serial number, year, condition
- 3-6 months business bank statements
- Business formation (LLC articles, S-corp filing, or sole-prop with EIN)
- EIN letter from the IRS
- Voided check or bank letter for ACH
- Driver license for personal credit pull and signing
Deals over $150K usually add a personal financial statement and the most recent business tax return. Same-day pre-approval is normal when the file is complete; funding hits the dealer 24-72 hours after sign.
Contractor Equipment Financing vs SBA
If you have 2+ years in business, 680+ FICO, and time to wait 4-8 weeks, an SBA 7(a) loan can finance equipment at lower rates with a 10-year term. Most working contractors do not have that runway when a job needs the equipment this week. Asset-based equipment financing is the answer for fast-moving deals; SBA is the answer for big consolidations or planned expansion.
Seasonal Cash-Flow and Equipment Payments
Contractor revenue typically clusters around weather: outdoor trades peak May-October, slow in winter; HVAC peaks summer cooling and winter heating. Lenders factor seasonality into the underwrite when bank statements show a clear pattern. If a slow month would put you below the new equipment payment plus existing obligations, the lender will price for that risk or ask for a larger down payment.
If equipment payments would strain the slow season, the right structure may be a longer term (lower payment) or a step payment that starts smaller. Both are negotiable on asset-based equipment loans; ask the broker before signing.
Next Step
Have an equipment quote in hand? Get matched for contractor equipment financing — one application goes to multiple asset-based lenders, surfacing the best rate and term for your file.