Is a down payment required for machinery loans?

A down payment is usually required when taking out a machinery loan. The amount of down payment needed will vary depending on factors like the lending institution, loan amount, and type of machinery being financed.

Making a sizable down payment shows the financial institution you are invested in the purchase. It also lowers the amount being financed, which reduces risk for the loan provider. This can help secure more favourable loan terms, like a lower interest rate.

Some financial institutions may offer no down payment machinery loans, but the loan terms are often less ideal. You may get a higher interest rate and be required to pay additional fees.

Before applying for a machinery loan, discuss down payment options with potential loan providers.