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3 min read

Excavator Financing: What are Payments on Used Excavators?


Looking at buying or leasing an excavator?

What will your monthly payments will be for excavator financing? 

If you only need the excavator occasionally, it may be cheaper to rent, but only if you're going to use it almost never.

Rental prices on excavators can easily run $10,000 a month, and that's typically for a unit you could buy for about $200,000.

If you're planning on using an excavator regularly, your best bet is going to be to buy or lease the excavator. Depending on the size of your business and your budget, you can finance or lease either a new or a used excavator

Loan Vs. Lease for an Excavator: Which is Better?


If you're buying with cash, that's easy, write a check and you've got yourself an excavator.

Excavator costs depend on the age, hours of use, whether it's a full excavator or a mini-excavator, and the model.

In general, a used mini-excavator will run you between $15,000 and $30,000 while a used full excavator can run from $40,000 up to $250,000 depending on the size, age, condition, and hours on the machine.

If you don't plan to pay cash up front, you can do either an excavator loan or a excavator leasing.

The main difference between the two:

  • with financing, you own the equipment at the end (for a final payment of one dollar)
  • with the lease, you can walk away at the end, or choose to buy the equipment for a balloon payment (the specific amount varies by contract)
  • leasing is a little bit cheaper in terms of monthly payments than financing.

The other big difference between the two is tax treatment. If set up properly, often you can write off your entire payments with an equipment lease. 

Bored of reading? We'll get you an estimate of what you can qualify for here

Many folks acquiring construction and heavy equipment finance through leasing, though equipment loans are sometimes the best choice. 

Excavator Leasing Rates: What are they?  


Leasing or financing rates on excavators depend on:

  • The age, hours and cost of the excavator
  • Your business and/ or personal credit
  • How long you've been in business
  • The length of the loan or lease 

Let's look at what approximate monthly payments would be on a loan for different loan terms per $25,000 spent on your excavator, based on a business that's been around for 2 years or more. (To acquire the same equipment on a lease where you own the equipment at the end for 10%, just deduct about 7% from the monthly payments below).


If you're buying a $100,000 excavator, for example, just multiply the numbers in the table above by 4 to figure your payment. Note that these numbers are approximate, but you can ask us for a real estimate based on your situation

Note - it often doesn't make sense to stretch your payment to 60 months even though that generates the lowest monthly payment, often times you save significant dollars in total financing by going shorter term without that much higher in monthly payments.

For example, with poor credit, financing for 3 years versus 5 years per $25,000 piece of equipment will save you almost $20,000 in finance costs while only increasing your monthly payment by $259.

At the lower interest rates (i.e. when you've got great credit) it's not quite as much of an issue - financing the same $25,000 for 3 years rather than 5 would save you about $2,500 in finance charges over the loan term while increasing your monthly payment by about $330.

Click here to find what you qualify for and your actual payments to finance an excavator.

The big differences between payments based on different credit profiles is due to the risks the lender takes. Used equipment depreciates, fast especially since you're (hopefully) putting it into a lot of hard hours. In order to stay in business, lenders have to charge a rate high enough to cover the costs of the companies that don't pay their equipment loan and still have enough left over to make a profit.

What does it Cost for a New Business to Finance or Lease an Excavator?

If your business is less than two years old, be prepared to pay a little bit higher rates. This is because 44% of new business fail within the first two years, and the failure rate drops significantly after the 24th month.

The rates depend on your credit, and new businesses financing any significant amount of equipment will almost always be asked for a security deposit or collateral (such as other construction equipment or something with a license plate on it).

That being said, here are your payments per $25,000 based on different profiles:


You may notice that for the "awesome" credit profile, it's significantly cheaper to lease with collateral than without. The less "risky" the transaction, the lower the costs go, as a big part of your payments go to compensate the lender for the "risk" inherent in lending to your business. 

Smarter Finance USA can help you get an honest quote to finance or lease an excavator. Call us at (866) 631-9996 or click in the picture below to get a quote.


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