# How much down payment do contractors need for equipment financing? > There is no single down-payment percent for every contractor equipment deal. Cash at signing depends on the funder, the machine, and your file. By Elie Mendlow · Published November 9, 2026 Section: Business Funding › Equipment & Invoice Finance · Series: Contractor Desk (https://mcafax.com/notebook/series/contractor-desk) Canonical: https://mcafax.com/notebook/contractor-equipment-down-payment Source: MCAFax, The Broker's Notebook (https://mcafax.com/notebook). MCAFax is not a lender or a law firm. --- Down payment on contractor equipment financing varies by lender, new versus used gear, credit, and advance rate. There is no single official percent for every dump truck or excavator. Get cash due at signing in writing, then test it against the next payroll week before you commit. This is general information, not legal or financial advice. ## Why do two quotes disagree on cash due at signing? Funders price risk differently. A dealer loan on a new unit can look nothing like a bank loan on high-hour used iron. Time in business, existing debt, and equipment class all move the advance rate. Treat every percent you hear as quote-specific until it is written on a term sheet. Friend-of-a-friend numbers are not underwriting. ## What should count as cash at signing? Add more than the labeled down payment. Include tax and title if due now, first insurance, delivery, inspection, and fees due before funding. A low down payment with large same-week extras still empties the account. Put the total beside the next two payroll dates and the supplier bills already on the calendar. ## How do SBA purchase paths change the cash question? SBA 7(a) and 504 equity injection and project-cost rules can differ from a plain installment loan. Read https://www.sba.gov/funding-programs/loans/7a-loans and https://www.sba.gov/funding-programs/loans/504-loans, then confirm SOP 50 10 8.1 with a lender. Contractor framing lives at https://mcafax.com/notebook/construction-business-loans with steps at https://mcafax.com/notebook/how-to-get-equipment-financing. Keep receipt-based products separate using https://mcafax.com/notebook/equipment-financing-vs-merchant-cash-advance. ## How do you pressure-test the percent before you sign? Ask what advance rate applies to this serial-number class and age, what else is due the same week, whether the quote expires if the invoice changes, and whether used units need inspection before final approval. If callers demand bank logins while you are still pricing down payments, use https://mcafax.com/notebook/stop-mca-broker-calls and return to a written equipment quote. ### Worked example All names and numbers are made up. Percents are quote labels, not averages. Red Clay Hauling wants a $140,000 dump truck. Quote A: 10% down ($14,000) plus $2,200 tax and title and $900 first insurance equals $17,100 cash week one. Quote B on a similar used truck: 25% down ($35,000) plus $450 inspection equals $35,450 cash week one. Quote C lease: $4,500 due at signing, then monthly payments through idle months. Available cash after payroll reserve was $22,000, so Quote B failed even though its monthly payment looked fine. They compared eight weeks of rent and later browsed options at https://mcafax.com/notebook/where-to-get-business-funding. ## What belongs on your one-page decision sheet? - Cash due at signing for each quote - Monthly payment and idle-month survival cash - New versus used conditions and inspection needs - Entity that will own and insure the truck - Backup rental plan if funding slips Field note: owners often compare monthly payments and ignore week-one cash. That is how a cheap-looking truck still breaks payroll. Used-equipment advance rates can also jump when hours or model year cross a funder's line. Write three numbers before you sign: cash due at signing, monthly payment, and idle-month survival cash after payroll and fuel. If any number is a guess, get a revised quote, then open https://mcafax.com/notebook/where-to-get-business-funding only after those three numbers are real. Field note: owners often compare monthly payments and ignore week-one cash. Used advance rates can also jump when hours or model year cross a funder's line. Write cash at signing, monthly payment, and idle-month survival cash on one page. ## Questions readers ask **Is there an official national down-payment percent?** No single government percent covers every private equipment loan or lease. Ask each funder for its advance-rate rules on your machine class. **Do leases always need less cash at signing?** Often they ask for less upfront than a purchase loan, but fees or deposits can close the gap. Compare total cash due at signing. **Can SBA change the cash needed at closing?** SBA 7(a) and 504 have their own equity-injection and project-cost rules. Confirm current SOP 50 10 8.1 requirements with a lender. **What if I cannot make the asked down payment?** Consider a different machine, a rent period, or waiting until cash catches up. Do not invent a percent.