Key highlights
- No-deposit finance funds the full purchase with nothing down
- The equipment secures the loan, so cash down is not required
- It preserves working capital for wages, materials and buffers
- Availability depends on the machine, credit and trading history
No-deposit equipment finance funds the entire purchase without any money down, because the equipment itself secures the loan. Instead of contributing cash, you borrow the full amount and repay it over the term, which preserves your working capital. It tends to suit strong, asset-backed applications rather than higher-risk files. Overdrive's Simon Kendrick compares more than 80 banks and non-bank lenders on one application to see whether a no-deposit structure is available to you.
How no-deposit finance works
Because equipment finance is secured against the machine you are buying, the lender's risk is partly covered by the asset's value rather than by a cash contribution from you. That is what makes lending the full purchase price possible. You take delivery of the machine, the lender holds an interest in it until the loan is repaid, and you make repayments over an agreed term, typically ranging from one to seven years depending on the machine and your plans. The absence of a deposit does not change the fundamentals of the loan; it simply means the whole amount is financed rather than part of it being paid up front in cash.
Who it suits, and who it may not
No-deposit structures are most readily available on strong, asset-backed applications: a good machine that holds value, a solid trading history and a clean credit profile. For those borrowers, funding the full amount keeps cash in the business. Where the machine is older or specialised, the business is newer, or credit is weaker, a lender may prefer a deposit to offset the added risk, so a fully financed deal may not be on offer or may be priced higher. As a guide, rates start from around 6.55% p.a. for strong, asset-backed deals, with higher-risk files priced higher, all indicative and subject to lender assessment.
Weighing the trade-offs
The main appeal of no deposit is cash flow: your capital stays available for wages, materials, repairs and the unexpected, rather than being locked into the machine. The trade-off is that you finance a larger balance, so repayments and total interest are higher than if you had put money down. Neither approach is right for everyone, and the balance depends on how tight your cash flow is against how much interest you want to save. A broker can model repayments with and without a deposit across several lenders, so you can decide with real numbers rather than guesswork.
If keeping capital in the business matters to you, it is worth seeing whether a no-deposit structure is available. Simon Kendrick can test your file across more than 80 lenders on one application and model the trade-offs. Get in touch for a free, no-obligation quote, and decide between funding the full amount or putting money down with real numbers in front of you.
Frequently Asked Questions
Is no-deposit finance available to everyone?
No. It is most readily available on strong, asset-backed applications with a good machine, solid trading history and clean credit. Higher-risk files, older or specialised machines, or newer businesses may need a deposit or face higher pricing. Comparing lenders is the practical way to see whether a no-deposit structure is realistically open to you.
Does no deposit mean higher repayments?
Generally yes, in the sense that you finance the full purchase price rather than part of it, so the balance, repayments and total interest are higher than a deal with money down. The benefit is preserved cash flow. Whether that trade-off is worthwhile depends on how much you value keeping capital in the business.
Can I use a trade-in instead of a cash deposit?
Yes. A trade-in's equity reduces the amount financed, working much like a deposit, while still letting you avoid handing over cash. If finance is owing on the trade-in, only the value above the payout counts. This can be a useful middle ground between a full no-deposit deal and a cash contribution.
Ready to compare cheap rates?
Free quote in minutes, decisions in 24–48 hours. No credit-score impact to enquire.