Commercial Equipment Refinance: How to Pull Cash Out of Equipment You Already Own

If you own a truck, trailer, or piece of equipment outright — no monthly payment, no bank on the title — you’re sitting on cash. You just haven’t pulled it out yet.

This guide explains how to turn equipment you already own into working capital, using a business loan structured as a cash-out refinance. It’s one of the most useful tools we have at Trust Alliance Capital, and it’s dramatically cheaper than the merchant cash advance offers you keep getting in your inbox.

If you own a paid-off dump truck, a paid-off day cab, a paid-off excavator, a paid-off tractor, a paid-off zero-turn trailer — you can probably do this. Here’s what qualifies, what doesn’t, what you need on the credit side, and how much money you can expect.

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What a commercial equipment cash-out refinance actually is

In plain English: you own the equipment. We lend you money against it. That money goes into your business bank account. The equipment becomes the collateral on the loan. You make a fixed monthly payment for 3 to 5 years. When you finish paying it off, the equipment is yours again free and clear — same as before.

It’s the same idea as a home equity loan, but on a piece of business equipment instead of a house.

Two common reasons customers do it:

1. You own the equipment free and clear and you need cash for the business — a new hire, expanded shop space, a down payment on the next piece, a slow season, a tax bill, a big repair on the shop building.
2. You still owe money on the equipment but there’s meaningful equity in it, and you’d rather refinance into one payment with cash left over than take out a separate loan.

Both work.

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How much cash you can actually get

We can lend up to 130% of the equipment’s wholesale value. Wholesale value is what a dealer would pay to buy your piece off you — not the retail price you’d list it for. As a rule of thumb, wholesale usually runs about 70% of retail, so if your piece would sell for $100,000 on the open market, its wholesale value is probably somewhere around $70,000.

Every deal is different, and the real number comes from the inspection and appraisal. Call us and we’ll give you a real dollar figure on your specific piece.

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What equipment qualifies

Cash-out works on almost everything we finance, with a few specific exceptions.

Eligible equipment (subject to age limits below):

• Heavy day cabs and tractors — Kenworth T800, Peterbilt 389, Freightliner Cascadia day cab, Volvo VNL day cab, Mack Pinnacle day cab
• Dump trucks — light-duty, medium-duty, and heavy-duty
• Vocational trucks — refuse, concrete mixer, bucket truck, boom truck, service body, vacuum truck
• Tow trucks and wreckers — rollback, light-duty, medium-duty
• Box trucks
• Reefer trailers
• Dry vans, flatbeds, step decks, lowboys
• Construction equipment — excavators, dozers, wheel loaders, skid steers, mini excavators, compact track loaders
• Agricultural tractors — full-size and utility
• Machine tools — CNC mills, lathes, press brakes
• Coach buses and shuttle buses

Not eligible for cash-out (hard exclusions):

• Over-the-road (long-haul) sleeper trucks — the ones with a full sleeper bunk. Day cabs are fine, but sleepers are excluded from this specific program.
• Medical, dental, and imaging equipment
• Commercial printing presses
• Forestry equipment — feller bunchers, log skidders, log processors

If your piece falls into an ineligible category, call us anyway — we may have a different program that fits.

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Age and mileage rules

Cash-out uses the same age limits we use across our whole program. In general:

• Heavy day cabs, dump trucks, refuse, concrete, bucket, boom trucks: 10 years or newer
• Tow trucks, wreckers, service trucks, light-duty work trucks: 8 years or newer
• Box trucks and reefer trailers: 6 years or newer
• Full-size construction equipment (excavators, dozers, wheel loaders) and heavy agricultural tractors: up to 15 years old
• Skid steers, mini excavators, compact track loaders, utility tractors: 10 years or newer
• CNC and machine tools: no hard age limit — evaluated case-by-case

Older equipment can sometimes be considered on high-value pieces (large excavators, dozers, cranes) where the resale value stays strong. Ask us on the call.

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Credit requirements — the specific numbers

We’re a specialty commercial finance company, not a bank. Our credit rules are more flexible than a traditional bank’s, but there are real numbers that decide whether the deal moves forward.

FICO score:

• 550 minimum if you’ve been in business at least 2 years
• 640 minimum if you’ve been in business less than 2 years
• 700+ gets you our best rates

Credit card utilization:

• Keep it under 40% if you can. That means if your total credit card limit across all cards is $20,000, you’re carrying less than $8,000. Under 40% signals healthy cash management and drops rate.

Time in business:

• Any length is considered, but under 2 years drops you into stricter credit terms.

Industry experience:

• At least 3 years in your industry. If you’re brand new to trucking, construction, ag, or whatever industry the equipment serves, that’s a hard stop on the cash-out program specifically.

Residency:

• Must be a U.S. citizen or permanent resident (green card).

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Comparable credit — this is the one that trips people up

You have to show the underwriter that you’ve handled a large loan before. That’s called “comparable credit.” Any one of these satisfies it:

• You own your home free and clear. Deed proves it. Home value has to be at least as much as the amount you’re borrowing.
• You own your home with a mortgage or HELOC, and the mortgage or HELOC balance is at least as much as the amount you’re borrowing, AND you’ve made on-time payments for the last 24 months straight.
• You have a non-mortgage installment loan (auto loan, another equipment loan, an RV loan, a personal loan) that’s at least 70% of what you’re borrowing, aged at least 24 months, with on-time payments the whole time.
• You have two seasoned installment loans (auto or equipment or personal) both aged at least 24 months with clean payment history.

What does NOT count as comparable credit:

• Credit cards alone. Revolving credit doesn’t satisfy this rule.
• Authorized-user accounts (loans where you’re listed on someone else’s account, not the primary).
• Student loans.
• Loans under 24 months old.

The most common way people get declined here is having a great FICO but only credit cards and a mortgage — no auto loan, no equipment loan, no installment history. If that’s you, we’ll flag it early and tell you what your options are before we pull credit.

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Deal killers — things that will stop the deal

Any of these on your credit or personal history and the cash-out program is off the table (some may still work on a different program — always ask):

• Bankruptcy discharged or dismissed within the last 12 months
• Foreclosure within the last 12 months
• Repossession within the last 3 years
• Late child support payments within the last 12 months (even if you’re currently caught up)
• Felony conviction within the last 10 years
• Large or excessive open tax liens
• No FICO score generated (a “thin file” that can’t be scored)

If any of these are on your record, don’t stop reading — but be straight with us on the first call and we’ll tell you what’s possible. We fund post-bankruptcy files on other programs all the time. The cash-out program specifically is more particular because we’re lending against equity, and equity-based lending has to be conservative on the credit side.

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Why this beats a merchant cash advance (MCA)

If you’ve ever borrowed against your business’s daily deposits — the products called MCA, revenue advance, ACH advance, factoring lite — you already know this: they’re expensive and painful.

An MCA typically costs somewhere between 40% and 350% total by the time you finish paying it back. They pull payments daily or weekly out of your bank account. They’re paid off in 6 to 18 months, meaning the pain is concentrated. If your revenue drops for a week, the daily draws don’t slow down — they just start bouncing.

A cash-out refinance on equipment you already own is a completely different animal:

• Real interest rate — much lower than an MCA’s total cost.
• One monthly payment — not daily draws. Predictable.
• 60-month term available — meaning the monthly payment stays reasonable.
• Fixed payoff amount — you know exactly what the whole thing costs on day one.

If you’re carrying an MCA right now and it’s eating you alive, tell us on the call. A cash-out refinance is often the way out.

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What we’ll need from you

Once we’ve done the initial phone call and you’ve decided to move forward, here’s the paperwork:

1. Signed credit application (we send it — takes about 15 minutes)
2. Proof you own the equipment — title, invoice, whatever proves it’s yours
3. If there’s still a loan on it: name of the current lender and payoff quote
4. Equipment specs — year, make, model, VIN or serial number, current hours or miles
5. Photos and video for the equipment inspection (we walk you through this — it’s called an Aspen inspection and there’s a $200 fee for it, paid by you, non-refundable)
6. Proof of insurance on the equipment
7. A short write-up on how you’ll use the money — this doesn’t have to be a business plan, just a paragraph or two

That’s it. Most cash-out deals fund in 5 to 10 business days once we have the paperwork back.

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Ready to see what your equipment is worth as cash?

Call (801) 332-9756 — a real person picks up. In about 5 minutes we can tell you a rough number on your specific piece and whether the deal fits.

Or pre-qualify online in 60 seconds and we’ll call you back the same business day.

We’ve been financing commercial equipment for 22 years. Family-owned, Kaysville, Utah, BBB A+ accredited. Real people, real phones, real answers.