Manufacturing Equipment Finance Broker Guide | Broker-in-a-Box

Frequently asked questions

What deal sizes are typical for manufacturing equipment finance?

Manufacturing equipment deals tend to be on the larger side. A single CNC machine can range from $50,000 to $500,000 or more depending on the make, model, and capabilities. Full production lines and multi-machine packages regularly exceed $1 million. The sweet spot for most brokers is the $100,000 to $500,000 range -- large enough for strong commissions but manageable in terms of underwriting complexity. Even smaller pieces like welding stations and testing equipment can run $20,000 to $80,000, and those add up when a manufacturer is outfitting a new cell or upgrading a line.

Do lenders prefer new or used manufacturing equipment?

Lenders finance both new and used manufacturing equipment, but their appetite varies. New equipment from recognized manufacturers like Haas, Mazak, DMG Mori, or Trumpf is straightforward for most lenders because the collateral value is well established. Used equipment is also very fundable, especially if it is from a reputable brand, has been well maintained, and has documented condition. Lenders will want to see the age, hours or cycles, and overall condition. Some lenders specialize in used industrial assets and are comfortable with equipment that is 10 to 15 years old if it has been properly serviced. The key for brokers is matching the equipment age and condition to the right lender.

How do I find manufacturers who need equipment financing?

The best sources are industrial equipment dealers and machine tool distributors. Companies like Haas Factory Outlets, Mazak dealers, and regional machine tool distributors sell equipment daily and their buyers need financing. Beyond dealers, attend manufacturing trade shows like IMTS (International Manufacturing Technology Show), network through local manufacturing associations and the National Association of Manufacturers, and visit industrial parks where manufacturers are clustered. Chamber of commerce manufacturing committees are another underrated source -- they connect you directly to business owners in your area who are actively investing in their operations.

What borrower information do lenders want on manufacturing deals?

Lenders want to understand the borrower and the equipment. For the borrower: time in business, annual revenue, personal credit scores of the guarantors, and recent financials (tax returns, profit and loss, balance sheet). For deals over $150,000, many lenders require full financial documentation, though requirements vary by lender. For the equipment: detailed specs including make, model, year, condition, and what it will be used for. Lenders also like to see whether the equipment is replacing aging assets or adding new capacity, because both tell a positive story about the business. If the borrower has existing equipment that is paid off, mention it -- free-and-clear assets strengthen the application.

What commission can I expect on manufacturing equipment deals?

Commission rates vary by lender, deal size, and structure. depending on the deal size, credit profile, and lender. For illustration, a hypothetical $200,000 CNC machine deal could generate meaningful commission income, and larger deals increase the dollar amount further. *Actual rates depend on the lender. Credit-challenged deals often carry higher commissions because the rates are higher. Manufacturing is attractive because the deal sizes are large enough that even moderate commission percentages generate meaningful income per transaction.