Farm machinery finance: a guide for Australian farmers

A tractor and a truck both get financed, but a lender doesn't read them the same way.

Farming gear has its own kind of rhythm.

It's expensive, it's seasonal, and a harvester that sits idle for ten months of the year looks different to a lender than a truck that earns every week. If you finance farm machinery the same way you finance a ute, you leave money and flexibility on the table.

What can you finance?

Anything that earns its keep on the farm.

Tractors, headers and harvesters, balers, sprayers, planters, and the machinery that supports them. And the trucks and trailers that move your stock and produce, which are a big part of what we fund for farming clients. Cattle transport trucks, in particular, come up often for operators running livestock between properties and saleyards.

The point is the same for all of it: if the asset generates income for the business, there's a lender who'll finance it.

Why is farm machinery different from a truck or a ute?

A tractor or harvester is more expensive than a typical truck, it wears differently, and it gets inspected differently.

Lenders know this, and it changes how they price and structure the deal.

Another reason is seasonality. Farming income doesn't land evenly across the year, and some lenders are set up for that. They'll structure repayments to match the season rather than demanding a flat monthly amount when the crop isn't in. It's not every lender, but it's a real option and it's worth asking for when your cash flow peaks around harvest.

What structure suits farm machinery?

Usually a chattel mortgage, for the same reason it suits most commercial assets.

You own the machine from the start, the lender holds a charge over it until the loan is repaid, and it sits on your balance sheet as your asset. For farm equipment you'll run for years, ownership is the natural fit, and a chattel mortgage can carry a balloon to keep your regular repayments down if that suits your cash flow.

As always, the tax treatment depends on your circumstances, so check with your accountant. What we'll do is structure the finance to match what they advise.

How much can I borrow, and do I need a deposit?

That depends on the asset and your profile, but the headline numbers are simple.

We can arrange agricultural finance up to $500,000, and no deposit is available up to $150,000, subject to your situation and the asset. On top of that, a deposit generally enters the conversation. The machine's age matters too, with terms generally available up to 25 years at the end of the loan term, not just at purchase.

Loan terms of 3, 5 and 7 years are standard, depending on the age of the asset, and repayments can be weekly, fortnightly or monthly. The rate itself depends on the asset, its age, your financials and which lender fits, so we'll give you an accurate figure once we understand your situation. You can get a ballpark any time with our machinery finance calculator.

How does the process work?

The same as any asset, with one farming-specific step at the front.

We start with a 20min discovery call to understand what you're buying, how your business earns, and when your income actually lands. That seasonal picture is the bit that shapes the deal, because it decides whether a seasonal repayment structure is worth asking for. From there we get you approved and settled, with funding as fast as 8 hours where the file is clean.

The earlier you come to us in the buying process, the better. If you've already picked the machine, we can move fast. If you're still deciding, a pre-approval gives you a budget to negotiate against.

What should I have ready?

The usual for a low doc application: your ABN, GST registration, recent BAS statements and recent bank statements. If you're running the farm through a company or trust, the structure details as well.

If your income is seasonal, have a sense of when your money comes in across the year. It's the one thing a farming application benefits from that a truck application usually doesn't need.

Please note this is general information only. This article provides general information and does not take into account your objectives, financial situation, or needs. Stacked Finance is a credit representative under Viking Asset Aggregation and provides commercial finance services only. Consider whether the information is appropriate for your circumstances and seek advice from your accountant or financial adviser before acting.