Can I finance used machinery, private sales, or auction purchases?

Short answer and what to expect

Yes — many UK lenders will finance used machinery, assets bought via private sale, and auction purchases, subject to standard checks and affordability. The right structure is usually asset finance (hire purchase, finance lease, or refinance), with funds paid directly to the seller or auction house.

At Best Business Loans, we don’t provide finance ourselves. We help you identify suitable lenders and brokers, understand what’s possible, and move faster with a Quick Quote and decision in principle.

For used assets, lenders focus on condition, provenance, and resale value. For private sales and auctions, they add extra verification to reduce fraud and ensure clear title.

Common ways to finance used, private, and auction purchases

• Hire Purchase (HP): Ownership passes at the end; VAT often due upfront, with options to defer.
• Finance Lease: You rent the asset for most of its useful life; typically VAT on rentals.
• Operating Lease: Shorter term, lower rentals, and the asset may be returned.
• Asset Refinance: Release value from equipment you already own to fund new purchases or working capital.

Settlements are usually paid straight to the vendor or auctioneer once documents and checks are complete. Fast-track approvals are possible once your profile and asset details are confirmed.

What we don’t support

We are focused on established UK businesses and do not assist with start-ups, sole traders, franchises, property finance, or commercial mortgages. We also cannot promise the lowest rate or any guaranteed approvals. All funding is subject to status, credit checks, and lender criteria.

Financing used machinery — how lenders assess value and risk

Used machinery is widely funded in the UK, particularly in construction, manufacturing, engineering, transport, and agriculture. Lenders typically look at age, hours, usage, brand, service history, and expected residual value.

Older assets can still be funded if they have demonstrable value and a strong market for resale. Expect maximum terms to align with the asset’s remaining useful life, often 2–5 years for mainstream equipment.

Deposits typically range from 0% to 30%, depending on the asset, your credit profile, and whether you want to include VAT deferral. Seasonal and flexible repayment profiles may be available for cyclical industries.

Documents and information that speed up used-asset approvals

• Pro-forma or seller invoice with full asset details, serial/VIN numbers, and VAT position.
• Service records, photos, condition report, and proof of provenance/ownership.
• Business bank statements (usually 3–6 months) and latest accounts/management figures.
• Insurance details for planned cover and location of the asset.
• For dealer purchases: dealer contact details and confirmation of HPI/finance clearance.

Typical steps include an initial eligibility check, asset verification, optional inspection, decision in principle, documentation, and payout to the seller. Subject to status and asset checks, this can be completed in days.

We regularly see demand for tractors, combines, telehandlers, and balers in agriculture. If you’re in farming, learn more about sector-specific options on our Farming Loans page.

Buying from a private seller — what’s different and how to prepare

Yes, you can fund assets sourced via private sale. Lenders will usually apply extra due diligence to make sure the seller has legal title and there are no existing charges on the asset.

Expect checks such as HPI/finance clearance, proof of ownership, asset identification against serial numbers, and verification of the seller’s identity and bank details. Some lenders may require an independent inspection.

Funds generally go directly to the seller once the agreement is signed and all checks are completed. Escrow-style arrangements can be used in some cases, but are not standard for every lender.

Risk controls lenders commonly use for private sales

• Proof of purchase chain (invoices, receipts) and service history for provenance.
• HPI or specialist asset register checks for encumbrances and theft markers.
• Condition reports and photographic evidence, sometimes a physical inspection.
• Payment to the named owner’s verified business bank account only.
• Clear, descriptive invoice with detailed make, model, year, hours/mileage, and serial numbers.

To speed approval, ask the seller early for documents, photos, and a written description that matches the invoice. Confirm the VAT position, as this affects the structure of the agreement and your cash flow.

Be cautious of red flags such as mismatched serial numbers, incomplete paperwork, or pressure to move funds quickly. Lenders will decline if they cannot validate ownership and condition.

Financing auction purchases — pre-approval and fast settlement

Finance for auction buys is common, particularly for plant, HGVs, agricultural kit, and engineering machinery. The smoothest route is to obtain a decision in principle before the auction so funds can be released quickly if you win a lot.

Many auction houses require rapid payment plus buyer’s premium and VAT. Some lenders can fund the hammer price and buyer’s premium, while VAT may be paid upfront or deferred depending on the agreement type and your VAT status.

If timeframes are tight, you can combine a pre-approved facility with a condition report or light-touch inspection post-sale. Where the auctioneer provides detailed lot information, lenders may rely on that plus independent checks.

How auction finance typically works

1. Get a Quick Quote and decision in principle before the auction, including your maximum spend.
2. Bid on the lots you want; note the hammer price and buyer’s premium.
3. Provide the invoice, lot numbers, and asset details immediately after the sale.
4. Complete verification and any required inspection quickly.
5. The lender pays the auction house; you sign the agreement; collection and insurance are arranged.

Costs can include documentation fees, inspection charges, and auction fees. Rates and terms vary by asset type, age, use case, and your business profile, and all offers are subject to status.

Arrange insurance cover from the moment the asset is released. Factor in transport, installation, and calibration costs, as these are usually not covered unless specifically included.

Eligibility, costs, process, FAQs, and next steps

Typical eligibility for used, private, and auction asset finance

• UK limited company or LLP with 12+ months’ trading and verifiable revenue.
• Acceptable credit profile, stable cash flow, and the ability to afford repayments.
• Assets with strong re-sale demand and identifiable serial numbers.
• Full documentation, including invoices and ownership proof.
• Appropriate insurance and business use of the asset.

Costs and features you might encounter

• Deposit: typically 0–30% depending on profile and asset risk.
• Rates: vary by asset, term, and credit — always subject to status and change.
• Fees: documentation, inspection, arrangement, and auction fees may apply.
• VAT: payable upfront on HP; may be deferred; or payable on rentals with leases.
• Terms: generally 12–60 months, aligned to useful life and residual value.
• Seasonality: flexible or seasonal payments may be available for cyclical sectors.

How Best Business Loans helps — in four simple steps

1. Complete a Quick Quote in minutes with your business and asset details.
2. Our system matches you with lenders and brokers actively supporting your sector.
3. Get a decision in principle and a clear list of what’s needed to proceed.
4. The chosen provider completes checks, pays the vendor/auction, and you take delivery.

Ready to move? Get your Free Quick Quote now for a fast eligibility check and indicative terms. There’s no obligation, and you stay in full control of your decision.

FAQs

Can I finance assets bought from overseas sellers or auctions?

Sometimes, yes, but there are more checks and logistics. Lenders may require UK import documentation, CE/UKCA compliance, and verified provenance before releasing funds. Transport, duty, and tax are usually outside the finance agreement unless explicitly included.

Can I finance the VAT if I am not VAT-registered?

If you are not VAT-registered, VAT is generally a cost to your business and cannot be reclaimed. Some lenders can capitalise VAT into the agreement for certain structures, but this depends on the product and your profile.

Can I include installation, training, or delivery costs?

Some soft costs can be included, especially under a lease, but not always. Be ready to fund installation or training separately if the lender restricts soft cost percentages.

Is there consumer-style protection if an asset is faulty?

Business asset finance is not protected like consumer credit. You should ensure the asset is as described and consider independent inspection, especially for private and auction purchases. Warranty status and remedies sit with the seller unless otherwise agreed.

How quickly can funds be released for an auction purchase?

With a decision in principle and documents ready, some providers can settle within 24–72 hours. Same-day payouts may be possible for pre-vetted customers and assets, but are not guaranteed.

Key takeaways

• Yes — used machinery, private sales, and auction buys can be financed with the right structure.
• Extra checks are common for private and auction purchases to validate title and condition.
• Prepare invoices, serial numbers, service history, and insurance early to speed decisions.
• VAT treatment depends on the finance product and your registration status.
• We connect you to suitable UK providers for a quick, informed decision — no obligation.

Important compliance information

Best Business Loans is an independent introducer. We do not lend money, give financial advice, or guarantee approval or specific rates.

All finance is subject to status, affordability, and lender criteria. Your asset may be at risk if you do not keep up repayments, and terms, rates, and fees can change.

Information on this page is provided in good faith for UK businesses and should not be relied upon as advice. Please seek professional guidance where appropriate.