Complete Guide to Agriculture Equipment Financing
Agriculture Equipment financing helps businesses acquire essential equipment without large upfront costs. Whether you're a startup or an established company, understanding your financing options is key to making smart investment decisions. Agriculture Equipment financing typically ranges from $25,000 to $750,000 for equipment like Tractors, Combines, Tillage Equipment, Grain Carts.
How Much Does Agriculture Equipment Cost?
The cost of agriculture equipment varies based on several factors:
- Equipment Type: Different tractors vs combines can vary significantly in price.
- New vs. Used: Used equipment typically costs 30-50% less than new, offering significant savings.
- Brand & Features: Premium brands and advanced features command higher prices.
- Market Conditions: Supply, demand, and economic factors affect equipment pricing.
Credit Requirements for Agriculture Equipment Financing
Excellent (720+)
Best rates: 4%-6%
Minimal down payment
Good (650-719)
Competitive rates: 6%-8%
5-15% down payment
Fair (550-649)
Higher rates: 8%-14%
15-30% down payment
Lenders also evaluate business revenue, time in business, existing debt, and the specific equipment being financed.
Down Payment Requirements
- $0 Down Options: Available for borrowers with 720+ credit scores and strong business history.
- 10-20% Down (Standard): The most common range for qualified borrowers.
- 20-30% Down: May be required for challenged credit or startup businesses.
Pro Tip: A voluntary down payment can lower your monthly payments and total interest paid, even if $0 down is available.
Financing New vs. Used Agriculture Equipment
New Equipment
- ✅ Lower rates (4%-9%)
- ✅ Longer terms (up to 84 months)
- ✅ Full warranty coverage
- ✅ Section 179 eligible
- ❌ Higher purchase price
- ❌ Faster initial depreciation
Used Equipment
- ✅ 30-50% lower price
- ✅ Slower depreciation
- ✅ Proven reliability
- ❌ Higher rates (+1-3%)
- ❌ Shorter terms (36-60 months)
- ❌ Limited or no warranty
5 Tips for Getting the Best Agriculture Equipment Financing
Compare Multiple Lenders
Get quotes from at least 3 lenders to ensure you're getting the best rate and terms for your situation.
Check Your Credit Before Applying
Review your credit report for errors and take steps to improve your score before applying for financing.
Consider Total Cost of Ownership
Factor in maintenance, insurance, and operating costs alongside your monthly payment.
Negotiate Terms, Not Just Rate
Look beyond the interest rate. Loan term, down payment, and prepayment penalties all affect total cost.
Understand Your Financing Options
Compare loans, leases, and SBA options to find the structure that best fits your business needs and cash flow.