Everything You Need to Know About Crane Finance

What Finance Options Are Available for Purchasing a Crane?

You can finance a crane through a chattel mortgage, hire purchase agreement, or equipment lease. A chattel mortgage is typically used when you want to own the crane outright and claim GST back on the purchase, while hire purchase spreads ownership over time with fixed repayments. Leasing allows you to use the crane without ownership, which can suit businesses that regularly upgrade to newer models or specialised machinery.

Each structure changes how you manage cash flow and tax. Consider a business purchasing a 50-tonne mobile crane. With a chattel mortgage, you pay a deposit, claim the GST input tax credit on the full purchase price at settlement, and then make monthly repayments on the financed amount. You also own the crane from day one, which means you can claim depreciation and deduct the interest portion of your repayments. With hire purchase, the lender owns the crane until the final payment is made, but your repayments remain fixed and predictable.

Leasing works differently again. You never own the crane, but your lease payments are fully tax deductible as an operating expense. This can suit businesses that need access to the latest technology without committing to long-term ownership, particularly for cranes used in industries where technology or safety standards evolve quickly.

How Much Deposit Do You Need to Finance a Crane?

Most lenders require a deposit between 10% and 30% of the crane's value, depending on whether it's new or used. A new crane from a reputable manufacturer usually qualifies for lower deposit requirements, while older or imported cranes may require a larger contribution upfront. Some lenders will accept the crane itself as collateral, which can reduce the need for additional security.

In our experience, businesses purchasing cranes above $300,000 are often asked to provide financials, including recent trading statements and tax returns, to demonstrate capacity to service the loan. If the crane is part of a larger fleet purchase or you're upgrading existing equipment, lenders may take your trading history into account and offer more flexible deposit terms.

Fixed or Variable Rates for Crane Finance?

Fixed monthly repayments give you certainty over the life of the lease or loan term, which is particularly useful when you're managing long-term contracts or projects with known revenue. Most commercial equipment finance for cranes is written on a fixed rate, meaning your repayment amount won't change regardless of interest rate movements. This makes budgeting more predictable, especially for capital-intensive purchases like cranes.

Variable rates are less common for plant and equipment finance, but they do exist. They may suit businesses that expect to pay down the loan early or refinance within a few years. However, the trade-off is that your repayments can increase if rates rise, which adds uncertainty to your cash flow planning.

If you're financing multiple pieces of equipment at once, such as a crane alongside excavators or forklifts, you may be able to negotiate a blended rate or structure the loans with staggered terms to match the expected life of each asset.

Are Crane Repayments Tax Deductible?

Yes, the interest portion of your repayments is tax deductible under a chattel mortgage, and the full repayment amount is deductible under a lease or hire purchase agreement. Cranes also qualify for depreciation deductions, which can reduce your taxable income over the life of the asset. This makes crane finance highly tax effective, particularly for businesses operating at higher income levels.

You can also claim an immediate deduction for assets under the instant asset write-off threshold if your business is eligible, though cranes typically exceed this threshold. Speak to your accountant before finalising the purchase to confirm how the structure affects your tax position.

What Type of Crane Can You Finance?

You can finance tower cranes, mobile cranes, crawler cranes, rough terrain cranes, and all-terrain cranes through standard asset finance structures. Lenders will assess the crane based on its age, condition, and resale value, which determines the loan amount they're willing to provide. Newer cranes from established manufacturers are easier to finance because they hold their value and have a longer usable life.

Specialised cranes, such as those used in ports or heavy industrial sites, may require additional documentation or proof of contracts to demonstrate ongoing income. Some lenders will also finance attachments, transport equipment, and modifications as part of the same loan, which keeps everything under one monthly repayment.

How Long Can You Finance a Crane Over?

Crane finance terms typically range from three to seven years, depending on the crane's expected working life and your business cash flow. A shorter term means higher repayments but less interest paid overall, while a longer term reduces the monthly cost and frees up cash flow for other business needs. Lenders will consider the crane's age and condition when setting the maximum term, as they want to ensure the asset retains value throughout the loan period.

If you're buying a used crane, expect the term to be shorter than for a new purchase. A 10-year-old crane, for example, may only qualify for a three or four-year term, while a brand new model could be financed over seven years. Matching the loan term to the crane's working life ensures you're not still paying off equipment that's no longer generating income.

Can You Refinance Existing Crane Finance?

Yes, refinancing can reduce your repayments, release equity, or consolidate multiple loans into one facility. If you financed a crane several years ago and rates have since dropped, or if your business has grown and you want to access additional funds, refinancing is worth considering. You may also refinance to switch from a lease to a chattel mortgage, or to change the loan term to suit your current cash flow.

Some lenders will allow you to refinance and top up the loan amount to fund additional equipment, such as a second crane or related machinery. This works if the crane still has sufficient value and your business can demonstrate capacity to service the higher loan amount. If you're managing multiple commercial loans across different lenders, consolidating them into one facility can reduce administration and improve cash flow visibility.

What Documents Do You Need to Apply for Crane Finance?

You'll need recent financials, including profit and loss statements, balance sheets, and tax returns, along with a quote or invoice for the crane. Lenders will also ask for proof of ABN, trading history, and details of any existing debts or finance facilities. If the crane is being purchased from an interstate or overseas supplier, you may need to provide additional documentation such as a purchase agreement or delivery timeline.

The application process typically takes a few days to a week, depending on the lender and the complexity of your financials. Once approved, settlement can occur within a few days, allowing you to take delivery of the crane and start using it. If you're purchasing from an auction or private sale, make sure the crane has a clear title and no outstanding finance, as this can delay the process.

Call one of our team or book an appointment at a time that works for you to discuss your crane purchase and find the finance structure that aligns with your business needs.

Frequently Asked Questions