"No money down" is one of the most searched phrases in equipment financing — and one of the most misunderstood. 100% financing is real and reasonably common, but it's a credit decision, not a product feature: the same lender may fund one business at $0 down and require 20% from another. Here's when full financing is realistic, when it isn't, and what putting nothing down actually does to your payment.
Why equipment loans can go to 100% at all
Most business loans require an equity cushion. Equipment financing is different because the loan is self-collateralizing: the lender takes a security interest in the exact asset you're buying, and repayment terms are typically matched to the asset's useful life (BDC, as of June 2026). If you default, the lender repossesses and resells the equipment.
That changes the math. A lender's real exposure isn't the loan amount — it's the gap between the loan balance and what the equipment would fetch at auction. When that gap is small, financing 100% of the price is a rational risk. When it's large, the lender closes the gap by requiring a down payment (equity injection).
So the honest answer to "can I get equipment financing with no money down?" is: it depends on how much residual risk your deal carries. Four factors drive it:
- Your credit profile — business and personal. SBA guidance is blunt that equipment financing providers review business credit reports and want to see projections for the revenue or cost savings the equipment will generate; approval is credit-dependent, never automatic (SBA).
- Time in business and cash flow. Established businesses with clean bank statements and a healthy debt service coverage ratio (DSCR) get $0-down offers far more often than startups.
- The equipment itself. A late-model excavator or CNC machine with a deep resale market supports high advances. Custom-built, niche, or rapidly obsolescing equipment (specialized software-driven gear, restaurant build-out items) usually requires borrower cash.
- New vs. used. Used equipment is financeable, but valuation uncertainty often means a lower advance — see our guide to used equipment financing rates.
"100% financing" — of what, exactly?
The sticker price is rarely the full cost of putting equipment to work. BDC's rule of thumb is to budget an extra 25–30% of the equipment's value for transportation, installation, maintenance, and training (BDC, June 2026). Those are soft costs, and lenders treat them very differently:
| What's being financed | Common lender treatment |
|---|---|
| Equipment invoice price | Core of every equipment loan; 100% advance possible for strong deals |
| Freight, rigging, delivery | Some lenders include; others exclude |
| Installation and setup | Frequently financeable when itemized on the vendor quote |
| Operator training | Less commonly included; ask explicitly |
| Sales tax | Varies by lender and jurisdiction |
| Extended warranties, consumables | Usually excluded |
Some lenders go beyond 100% of invoice specifically to absorb soft costs — BDC publishes that it can finance up to 125% of the equipment's upfront cost to cover transportation, shipping, installation, and training. That's a Canadian example, not a US market norm, but it illustrates the key question to ask every lender: "What exactly does your advance cover?" A "$0 down" offer that excludes $20,000 of rigging and installation isn't really zero out of pocket.
When a down payment is likely — including every SBA 504 deal
Expect to bring cash when one or more of these applies:
- Newer business or thin credit. Under roughly two years in business, most lenders want skin in the game. See equipment loan requirements for what underwriters check.
- Very large tickets. BDC notes that for larger purchases, a cash down payment may be required, sized to the lender's assessment of your financials.
- Hard-to-resell or special-use equipment. Low auction value means a lower loan-to-value (LTV) ceiling.
- Past credit events. Slow pays, tax liens, or a prior default shift risk back to you.
- SBA 504 structure. SBA 504 loans finance long-term machinery and equipment with a remaining useful life of at least 10 years, up to $5.5 million, with 10-, 20-, and 25-year maturities (SBA, as of Sept 2026). The standard project structure is a private senior lender at up to 50%, a CDC (Certified Development Company) loan at up to 40%, and a borrower contribution of at least 10% — that 10% is the baseline for established businesses buying general-purpose assets, and SBA program rules require an additional contribution (typically 5% more for a new business and 5% more for special- or limited-use property) for higher-risk deals. So a 504 equipment deal is never zero-down, and borderline borrowers should plan for 15–20%.
- SBA 7(a). Equipment terms are generally 10 years or less unless the useful life exceeds ten years (plus up to 12 months for installation); rates are negotiated within SBA maximums, and down payment expectations depend on the lender's credit analysis (SBA lender guidance, Sept 2026).
| Structure | Typical minimum down | Notes |
|---|---|---|
| Conventional equipment loan, strong credit | Often $0 | Deal-specific; equipment must hold value |
| Conventional loan, newer business / weaker credit | Varies by lender | Set in underwriting; no universal number |
| SBA 504 equipment project | 10% baseline | +5% for new businesses, +5% for special-use assets per SBA program rules — never $0 |
| SBA 7(a) equipment loan | Lender-determined | Credit-dependent; terms generally ≤10 years |
| $1-buyout lease or FMV lease | Often first/last payment upfront | FMV lease = lower payments but no automatic ownership (SBA) |
Two worked examples: what $0 down really costs
Both examples use an illustrative 9% rate on a 5-year fully amortizing loan — your actual offer depends on credit, equipment, and lender. Run your own scenario with the equipment financing calculator.
Example 1: $150,000 skid steer package, $0 down vs. 15% down
| $0 down | 15% down ($22,500) | |
|---|---|---|
| Amount financed | $150,000 | $127,500 |
| Term / rate (illustrative) | 60 months at 9% | 60 months at 9% |
| Monthly payment | ≈ $3,114 | ≈ $2,647 |
| Cash kept in the business today | $22,500 | $0 |
| Extra paid per month for $0 down | — | ≈ $467 |
Financing 100% costs roughly $467 more per month. Over 60 months that's about $5,500 more in total interest — but you kept $22,500 of working capital on day one. If that cash covers an operator's first months of wages, or bridges you through a slow season, $0 down can easily be the better trade. If your margins are thin and $467/month strains your cash flow, the down payment is cheap insurance against a missed payment.
Example 2: $300,000 CNC machine plus $50,000 in soft costs
Suppose installation, rigging, and training add $50,000 to a $300,000 machine — right in BDC's 25–30% rule-of-thumb range.
- Lender A advances 100% of invoice only: you finance $300,000 (≈ $6,228/month at 9%/60 months, illustrative) and pay $50,000 cash for soft costs. Your "no money down" deal cost $50,000 out of pocket.
- Lender B rolls soft costs into the loan: you finance $350,000 (≈ $7,266/month) with $0 out of pocket.
Lender B costs about $1,038 more per month but preserves $50,000 in cash. Neither is universally better — but you can't compare them unless you get the soft-cost question answered in writing. Our guide to comparing business loan offers walks through putting offers on equal footing.
▦Estimate your equipment financing paymentsRun the numbers in the equipment financing estimator →▸The honest trade-offs of $0 down
What you gain: preserved cash for payroll, inventory, and emergencies; faster deployment when a revenue-generating machine is waiting; no need to drain reserves right before taking on a new payment.
What you give up or risk:
- Higher payment, more total interest. Every dollar not put down is a dollar financed at interest.
- Negative equity risk. Equipment often depreciates fastest in year one. At 100% financing, the loan balance can exceed resale value early in the term — a problem if you need to sell or trade up.
- Tighter DSCR. A bigger payment leaves less cushion, which can also affect your ability to qualify for other financing later.
- Possibly a higher rate. Some lenders price higher-LTV deals higher. Always ask for the payment at $0 down and at 10–15% down and compare.
One lever worth asking about: some lenders offer payment flexibility such as seasonal schedules or principal postponements — BDC, for instance, offers principal postponements for up to the first two years on equipment loans (as of June 2026). That can matter more than the down payment itself for a seasonal business.
How to actually get a $0-down offer
- Get a detailed vendor quote that itemizes equipment price, freight, installation, and training — lenders can only finance soft costs they can see.
- Prepare your file: recent bank statements, financials, and a short projection showing the revenue or cost savings the equipment produces. SBA guidance confirms lenders want exactly this.
- Ask every lender the same three questions: What percentage of invoice do you advance? Which soft costs are included? What's the payment at $0 down versus 10–15% down?
- Shop the deal. Down payment policies vary more between lenders than almost any other term. Because EQ Funding is a marketplace — not a lender — one application is routed to a network of equipment lenders across the US and Canada who compete for your business. That's the practical way to find out whether your deal qualifies for 100% financing, rather than relying on any single lender's policy.
Zero down is a legitimate goal, not a myth — but it's earned by the strength of your credit, your cash flow, and your equipment's resale value. Know what the advance covers, price both structures, and let lenders compete on the answer.