You have banked with the same bank for eleven years. They have your transaction account, your overdraft and probably your mortgage. So when the excavator needs replacing, walking into that branch feels like the obvious move. It might be. It also might mean you get one lender’s answer, one lender’s pricing and one lender’s view of your industry, and no way of knowing whether that was a good outcome or just the only outcome you asked for. That is the actual question behind broker versus direct: not who is nicer to deal with, but how many credible answers you get to see before you commit five years of repayments.
Short answer: Going direct means one lender assesses your application against its own policy. An equipment finance broker submits to a panel of lenders, matches your business profile and asset type to the lenders most likely to approve it, and negotiates structure and pricing. The trade-off is an extra party in the process.
What does an equipment finance broker actually do?
A broker sits between your business and a panel of lenders. The work involves assessing your position, identifying which lenders suit your industry, asset and credit profile, packaging the application so it is assessed properly the first time, negotiating structure and pricing, and managing settlement with the supplier. TYG works across more than 80 lenders.
The part that is easy to underestimate is the packaging. Credit assessors make decisions on the file in front of them. A file that explains why a $180,000 second-hand crusher makes sense for a business with a specific contract and a specific replacement cycle reads very differently to a bare application form with an invoice attached. A broker who finances that asset class regularly knows what the assessor will ask before they ask it, and answers it in the submission.
The other part is knowing which lenders to avoid for your particular situation. Every lender has quiet preferences: asset types they like, industries they have been burned in, ABN ages they will not go below, asset ages they will not exceed. Submitting to the wrong lender costs you time and leaves an enquiry on your credit file for nothing.
How is that different from applying direct to your bank?
Direct means one credit policy, one appetite and one answer. If your business fits that lender’s box, going direct can be fast and clean. If it does not, a decline tells you nothing about whether another lender would have said yes, and you start again from scratch somewhere else.
Banks also tend to think in terms of general business lending rather than asset-specific finance. A specialist equipment financier may understand the residual value of a wheel loader or a linehaul prime mover far better than a generalist business banker, and that understanding can flow through to term length, deposit requirements and how the asset is treated as security. Where the equipment is unusual, older or industry-specific, that difference in knowledge can be the whole ballgame. Our companion piece on truck finance broker versus bank covers the same tension from the transport side.
| Consideration | Through an equipment finance broker | Direct to a single lender |
|---|---|---|
| Lenders assessed | Multiple, matched to your profile | One |
| Who prepares the submission | Broker, with your input | You |
| Effect of a decline | File can be repositioned to another lender | Start again elsewhere |
| Indicative time you spend on the process | 1 to 3 hours supplying information | Several hours per lender approached |
| Credit enquiries | Usually limited by pre-matching before submission | One per lender you approach separately |
| Who pays the broker | Usually the lender, by commission, disclosed to you | Not applicable |
| Knowledge of niche asset classes | Varies by broker, often specialised | Varies by lender, often generalist |
The comparison above is general and indicative. Individual experience varies with the broker, the lender and the complexity of the application.
When does going direct make sense?
Direct can be a sensible choice when your business is well established, your existing bank already holds your accounts and security, the asset is straightforward, and the bank has given you a facility limit to draw on. In those cases the relationship and the speed can outweigh the value of shopping around.
Situations where direct often works:
- You already have an approved equipment finance limit with your bank and simply need to draw against it
- The purchase is small enough that the effort of comparing is disproportionate
- Your bank holds broader security and pricing is already tied to that relationship
- The supplier is offering manufacturer-backed finance with terms that stack up on comparison
That last one deserves a caveat. Dealer or manufacturer finance can be genuinely competitive, particularly during a promotional campaign, but it is still one option. Comparing it against a panel costs you very little and tells you whether the headline offer holds up once fees, term and residual are factored in.
Where does a broker usually add the most value?
The gap between broker and direct widens as the situation gets less standard. Newer ABNs, mixed credit history, used or specialised equipment, private sales, businesses with seasonal income, and applicants who need a structure that a single lender will not write are all cases where access to a panel changes the outcome rather than just the pricing.
A few concrete examples of where panel access matters. Consider an operator who needs to replace an ageing excavator mid-season and cannot afford three weeks of back-and-forth: a broker who knows which lenders turn around straightforward commercial applications within 24 to 48 hours can save the season. Or a business buying a twelve-year-old piece of plant from a private seller, where several mainstream lenders will simply decline on asset age while a handful of specialists will not. Or an applicant who needs the deduction timing to work for a year-end purchase and therefore needs an ownership structure like a chattel mortgage rather than a rental agreement, which ties directly into how the instant asset write-off applies.
Structure is the underrated piece. Term length, deposit, balloon or residual and payment frequency all affect what the finance costs you in total and how it sits against your cash flow. Rates vary based on the lender, the age and type of the asset, the term and your credit profile, so a slightly different structure with a different lender can produce a meaningfully different result on the same purchase.
What should you ask an equipment finance broker?
Ask questions that reveal how the broker works, not how enthusiastic they are. You want to know how many lenders they can actually access, how they get paid, whether they have financed your specific asset type before, and what they will need from you. A broker who answers all four plainly is one worth dealing with.
- How many lenders are on your panel, and which ones are you likely to approach for this asset?
- How are you paid, and will the commission be disclosed to me in writing?
- Have you financed this type of equipment before, and what did those structures look like?
- What documentation do you need from me upfront so we avoid a second round of requests?
- Will you submit to multiple lenders at once, or match my file to one before submitting?
- What are the fees, including any origination or documentation fees, and are they financed or paid separately?
- What happens if the first lender declines?
- Who handles settlement with the supplier, and what is the realistic timeline?
On the credit enquiry question specifically: scattering applications across multiple lenders in a short window can work against you, because some assessors view a cluster of recent enquiries as a sign of distress. A broker matching your file before submission is protecting you from that, which is a benefit that never shows up on a rate comparison.
You should also expect a broker to tell you when the answer is no, or not yet. An honest “your ABN is four months old, put a deposit together and come back in six months” is worth more than a submission that will not fly. For more background on the products themselves, browse the Machinery and Equipment Finance section, or see our equipment finance page for what TYG arranges day to day.
Frequently Asked Questions
Does using an equipment finance broker cost me more?
Brokers are usually paid a commission by the lender, which is disclosed to you. In some cases a broker fee applies and should be set out in writing before you proceed. Access to a panel can offset the cost, though outcomes vary by application.
Will a broker check my credit file before applying?
A broker will generally review your position and ask about your credit history before submitting anything. Formal credit enquiries are typically made once your file has been matched to a suitable lender, which helps avoid unnecessary enquiries on your file.
Can a broker help if my bank has already declined me?
Often yes. A decline reflects one lender’s credit policy, not a universal assessment. Understanding why the decline happened is the starting point, since that determines which lenders on a panel might view the same application differently.
How long does equipment finance usually take?
Straightforward commercial applications can commonly be assessed within 24 to 48 hours where information is provided upfront. Settlement timing then depends on the supplier, invoicing and any inspections. More complex or private-sale purchases generally take longer.
Is a broker useful for a small equipment purchase?
It can be, particularly if your business is newer, the asset is used, or you want the structure to line up with a tax position. For very small purchases where you already hold an approved facility, drawing on that facility is often simpler.
If you would rather have someone else work the lender panel while you keep the machines running, that is the job we do. Send us the equipment details and a short summary of your business through the TYG Finance contact page, or phone 1300 894 894.