The short version
- Excavator finance is business asset finance for earthmoving and construction equipment, written most often as a chattel mortgage with the machine itself as security.
- Indicative rates in August 2026 run 7 to 12% p.a. for new equipment from the mainstream brands and 9 to 14% for older machines or the newer import brands.
- Brand moves the deal more than most borrowers expect. A Caterpillar or Komatsu is written by nearly every lender on the panel; a Chinese import gets a shorter list, a deposit, and sometimes a shorter term.
- Approvals on clean deals run 24 to 48 hours with the specialist lenders and settlement takes three to seven business days, which matters when the machine has a job waiting for it.
Most excavator purchases have a contract attached. The machine is being bought because a job starts in three weeks, a tender landed, or the hired unit on site is costing more per month than a repayment would. That time pressure shapes the whole exercise: the structure has to be decided quickly, the lender has to be one that moves at the same speed, and a pre-approval is worth having before bidding at auction. This guide covers what the finance looks like, what it costs, how lender appetite splits by brand, and the case where hiring beats owning — written for the civil contractors, earthmovers and trades businesses that buy this equipment.
What construction equipment finance covers
The excavator market alone spans a wide price range. Mini and midi excavators from 1.7 to 8 tonnes run roughly $35K to $140K new. General-purpose diggers in the 12 to 25 tonne class sit between $180K and $400K. The 30 to 50 tonne machines working bulk earthworks and quarries go well beyond that.
The same finance covers the rest of the yard: wheel loaders, skid steers and track loaders, dozers, graders, rollers and compaction gear, articulated dumpers, and road plant such as profilers and pavers. Attachments — buckets, augers, hydraulic hammers, tilt hitches — can be financed on the same contract as the machine, which is usually cleaner than paying cash for them separately. New equipment moves through dealers; used equipment comes through dealers, auction houses and private sales, and all three channels are financeable.
How the deals are structured
The chattel mortgage is the default, as it is across asset finance generally. The business owns the machine from settlement, the lender pays the vendor directly and registers its interest on the PPSR, the GST on the price comes back on the next BAS, and depreciation and interest run through the tax return.
Two alternatives earn their place. An operating lease suits equipment needed for the life of a project rather than the life of the machine — the rentals are deductible, the machine goes back at the end, and the residual risk stays with the lender. The chattel mortgage vs operating lease comparison sets out the tax mechanics. Rental-to-own arrangements from specialist equipment providers cost more again, but convert hire payments into equity and suit an operator whose contract pipeline is too short or too new for a standard approval.
Documentation follows the usual two paths: full-doc with two years of financials, or low-doc off six to twelve months of BAS for businesses with two or more years of ABN history. For newer entities, a signed contract or a letter of engagement from a principal does real work in an application — lenders fund pipelines, not hope. One practical note on auctions: payment terms are typically days, not weeks, so arrange the pre-approval before the bidding, not after.
What excavator finance costs
Two bands cover most of the market in August 2026.
- New or near-new equipment from the mainstream brands, established business: 7 to 12% p.a. The lower half of the band belongs to full-doc borrowers with clean files; low-doc sits in the upper half.
- Older machines, high-hour units, or the newer import brands: 9 to 14% p.a. Deposit expectations rise in step.
Deposits run from zero on new mainstream equipment for an established operator, to 10 to 20% on used machines and imports. Trade-in equity counts — the value in the machine being replaced can stand in for a cash deposit. Balloons exist but run smaller than in the truck market, usually 10 to 30%, because hour meters do to resale value what decades do to buildings. Terms run three to five years for most machines, occasionally seven on larger plant. On used equipment, hours matter as much as age: a five-year-old 20-tonner with 3,000 hours and a service history prices differently to the same machine with 9,000 hours and none.
Brand appetite: who writes what
This is the section that decides real deals, and the one most equipment finance pages skip.
The tier-one brands — Caterpillar, Komatsu, Hitachi, Volvo, Kubota — carry the broadest lender appetite. Nearly every asset financier on the panel writes them, residual values are well understood, and the manufacturer captives (Caterpillar Financial Services, Komatsu's own finance arm) compete on their own equipment with sharp campaign pricing, particularly on new stock.
The established mid-tier — JCB, Case, Develon, Hyundai, Takeuchi, Bobcat, Yanmar — is written by most of the market at similar terms, sometimes with slightly more conservative residual assumptions.
The import brands are where appetite genuinely splits. Sany, XCMG and LiuGong machines have taken real market share in Australia, and lender appetite has widened as resale data accumulated — but the list is still shorter. Expect a 10 to 20% deposit, a possible term haircut, and a smaller set of lenders willing to write them used. None of that makes the machine the wrong purchase; the capital saving on the price is often larger than the finance penalty. It does mean the lender has to be chosen before the deposit is paid, not after. Specialist lenders — Pepper, ScotPac and Lumi among them — do much of the volume the banks won't touch in this corner.
When hiring beats owning
Finance is not always the answer, and it is worth being straight about when it isn't.
Wet hire (machine with operator) or dry hire (machine only) beats ownership when the need is short and defined. A 30-tonner needed for one ten-week bulk-earthworks package is a hire, not a purchase: the hire rate will exceed a repayment month for month, but it ends when the job ends, and there is no machine to sell into a soft market afterwards. The utilisation test is simple. Equipment that earns most weeks of the year justifies owning. Equipment that earns on one contract justifies hiring.
The common landing point for civil contractors is a hybrid: own the machines that work every week — the 8-tonner, the skid steer, the roller — and hire the big or specialised units per project. The owned fleet builds equity and the hired fleet keeps risk off the balance sheet.
GST and depreciation
Under a chattel mortgage the business owns the machine at settlement, so the full GST credit on the purchase price is claimable in the next BAS. There is no car-limit issue with plant and equipment.
Depreciation runs under Division 40, with the ATO's effective-life tables putting most excavators and loaders at around ten years. Hours worked change the resale value, not the tax life. Interest on each repayment is deductible. The instant asset write-off threshold of $20,000 occasionally covers an attachment, but not a machine — the full cost of an excavator depreciates over its effective life in the ordinary way, and anything more aggressive is a conversation for the accountant, not an assumption for the finance.
If a machine purchase is on and the job is waiting, call 1300 094 529 for a read on which lenders write the brand and the structure that fits, or start with the application form. Most enquiries get a response within four business hours.