How to set up a customer financing program for your equipment dealership

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Your customers already finance equipment. In the Equipment Leasing & Finance Foundation’s most recent Horizon Report, 82% of businesses that acquired equipment or software in 2023 used at least one form of financing to pay for it. Banks supplied 59% of that financing volume, and roughly three quarters of the bank share came from the buyer’s own primary bank. Manufacturers and vendors supplied 17%, and independent finance companies 15%.

So the real question is not whether your customers finance. It is whether the financing happens at your counter, on your timeline, or at their bank three weeks after your quote. If you are still deciding whether to offer financing at all, start with why equipment dealers offer financing. This guide is the how: the decisions, the order to make them in, what each one costs, and how long each one takes.

How does a dealer financing program work?

A dealer financing program is a relay. You sell the equipment, a finance partner carries the credit, and the customer pays the partner over time. The dealer never holds the paper. On a typical deal:

1. You quote the equipment with a monthly payment next to the price.
2. The customer applies, on a short application or a link you send. Five West uses a soft credit inquiry, so applying does not affect the customer’s credit score.
3. The partner underwrites the file: time in business, credit, cash flow, the equipment, and the structure that fits it.
4. Documents are signed electronically, and the equipment ships.
5. You get paid. Once the customer has signed and the equipment is delivered and accepted, the partner pays you the full invoice.
6. The customer pays the funder for the term. On a Five West program you carry no receivable and do no collecting; the customer’s obligation runs to the funder, not to you.

Everything in the setup below exists to make those six steps fast, predictable, and nearly invisible to your customer.

What are your options: captive, bank, independent partner, or in-house?

There are four ways to put financing in front of a buyer. Most dealers end up using two of them.

The common setup is a captive for new, single-brand promotions and an independent partner for everything else: used inventory, other brands, projects with installation and software, and the buyer the captive turns down. That second lane matters more than it looks. In the Federal Reserve’s 2025 Small Business Credit Survey, only 42% of small businesses that applied for a loan, line of credit, or cash advance received the full amount they sought; 36% received some of it, and 22% received nothing. A program with a single credit box sends a lot of your buyers into that 22%. We cover that scenario in what to do when internal financing declines a deal.

Doing it yourself is the option that looks cheapest and rarely is. Our guide to why dealers who play broker end up worse off walks through the staff, data, and liability it quietly adds.

How to set up a customer financing program in six steps

The order matters. Dealers who start with the website or the brochure usually redo both once the program’s real limits are clear.

1. Map how you sell today

Before you talk to any partner, write down how deals actually happen at your dealership. Bring these to the first call:

• What you sell, by category and brand, and your mix of new and used.
• Your typical ticket and your largest. Five West’s usual range runs from a $15,000 minimum to $5 million and above.
• Who buys it: the industries, how long they have been in business, and how they pay today.
• How many quotes you send a month, and how many buyers ask about financing.
• Where deals die. If they stall at the customer’s bank, you need speed. If they die on credit, you need more than one credit box. If they die on the payment, you need structures: longer terms, deferred or seasonal payments, or a fair market value lease.

Decide the scope at the same time: equipment only, or equipment plus freight, installation, training, software, and extended warranties rolled into one payment. On qualifying transactions Five West includes those soft costs, so your customer sees one payment for the whole project instead of a financed machine and a pile of cash invoices.

2. Choose one financing partner, and test it

Your partner sits in the middle of your sale, so judge it the way you would judge a sales hire. Five questions settle most of it:

1. Who answers, and how fast? You want a named person and a first response the same day. Five West’s standard is 1 to 2 business hours on most submissions, with approvals in as little as 30 minutes on clean files.
2. How many credit boxes sit behind one submission? A partner with a single program declines everything outside it. Five West matches each file to the program that fits, either a bank program or its own direct lending program, so a decline from one does not end the deal.
3. What is the application-only limit? Most small and mid-ticket deals should be decided on a short application without financial statements. At Five West that runs up to $500,000 on qualifying transactions.
4. When and how do you get paid? The answer you want: in full, directly, on funding. Ask what happens with deposits on equipment that has to be ordered or built.
5. What does a decline look like? A real reason, and a restructure attempt first: more money down, a shorter term, a co-signer, or a different program.

Then run one live deal through them and time every stage. Pick one partner rather than five: the same customer landing on five desks the same day reads like a file that was declined somewhere, as we explain in why not to shop one application to several lenders. The full checklist is in could your financing partner do better?

3. Pick the program tier that matches your volume

Most partners offer tiers. The difference between them should be how much of the program carries your brand and how much volume you send, not how much you pay. At Five West all three tiers are free:

Application volume is the dollar total of the customer applications you send in a month. Program details are on the partner programs page.

Start where your volume is today. Plenty of partners send their first few deals as 3rd Party, move to Co-Branded once the volume is steady, and build Private Label when financing becomes part of how they sell. Moving up a tier does not restart anything. If you run a smaller shop, how smaller dealerships should offer financing covers the first two tiers in more detail.

4. Put a payment on every quote, and financing on your website

Buyers weigh a monthly payment against the revenue the machine will bring in. In the Horizon Report, “optimization of cash flow” was the top reason businesses gave for financing, cited by 62%. Two changes do most of the work, and neither costs anything:

• A monthly payment on every quote. Your partner gives you payment estimates for your usual terms. Put the estimate next to the price on the quote you already send, not in a separate brochure.
• An apply button and a payment estimate on your website. Five West’s partner widgets add a payment estimate, an apply button, or a complete financing page with one pasted snippet, and every application arrives tagged to your business.
• The same link everywhere else: your reps’ email signatures, printed quotes as a QR code, and trade show handouts.

Our guide to offering financing online covers wording and placement.

5. Train your reps in one short session

A program nobody mentions closes nothing. The training that matters fits into one short session:

1. Raise financing with the price, not after the objection. “It’s $84,000, or about $1,740 a month” starts a different conversation than a sticker price does.
2. Prequalify before the demo. A soft-pull prequalification tells your rep whether the buyer can be financed, and for roughly how much, before anyone spends a week on quotes. See using your finance partner to qualify prospects.
3. Hand off cleanly. One link, one contact. The quick app in the Partner Portal takes about a minute for the basics, with no documents and no Social Security number.
4. Quote payments as estimates. Never promise a rate or an approval. The partner quotes terms after it reviews the file.

Five West runs that session with your team as part of setting up a program, and your dedicated finance rep stays available afterward for the deals that do not fit the script.

6. Submit deals, track them, and review the first 90 days

Every Five West tier starts with a 90-day trial. Use it to measure, not just to see whether anything breaks. Partners on a Five West program get a sign-in to the Partner Portal to follow each deal from application to funding. Track these from the first deal:

Vendor programs compound once they are part of how a floor sells. As of September 1, 2026, Five West’s application volume was up 60% year over year and funded applications were up 40%, and dealer and manufacturer partners routing customer financing through Five West at the point of sale were a meaningful part of that growth.

How long does it take to set up a financing program?

Less time than most dealers expect, because most of the build sits on the partner’s side. At Five West:

Once you are live, every deal runs on the same clock:

Larger transactions that need full financial statements take longer. A good partner tells you which path a deal is on the day it arrives.

What does a dealer financing program cost?

Set up the usual way, nothing. The customer pays the finance charge, the same as they would at their own bank, and the partner pays you in full. Where dealers do end up spending money is in a handful of optional or buried places, and they are worth checking in any program before you sign:

On promotional rates specifically: a rate buy-down and an equal price discount cost about the same money, so use one where a low payment sells better than a lower price. The math is in why equipment manufacturers offer financing.

Which customers and deals can a program approve?

A program is only as useful as the files it can say yes to. Here is what Five West’s programs cover:

• Established businesses, generally two or more years in business, with 600+ FICO on many programs.
• Select startup programs for experienced operators, typically with 700+ personal credit, relevant industry experience, and working capital left after the purchase.
• Transactions from a $15,000 usual minimum to $5 million and above, with application-only decisions up to $500,000 on qualifying transactions.
• New, used, and refurbished equipment, titled or non-titled.
• Equipment finance agreements from 24 to 84 months, and leases from 24 to 60 months with $1, 10%, or fair market value buyouts.
• Deferred and seasonal payments, no prepayment penalty on many programs, and progress or pre-funding on qualifying transactions.
• Soft costs such as freight, installation, training, software, and extended warranties on qualifying transactions.

Files are weighed as a whole, so cash flow, the equipment, and money down all move the answer. A borderline file is reviewed for a restructure before it is declined, and when a file cannot be placed you hear that plainly and early, so your rep can move on. For your customers’ side of the credit question, point them to what credit score you need for equipment financing and our qualification guidelines.

Mistakes that stall a new financing program

1. Raising financing only after the price objection. By then the buyer has already done the math on the sticker price. Lead with the payment.
2. Shopping one customer to several lenders at once. It slows the deal and makes a good file look like a declined one.
3. Brokering deals yourself. You take on a finance company’s cost, data, and liability for a thin and uncertain spread.
4. Hiding the apply link on a financing page nobody visits, instead of putting it on quotes, emails, and product pages.
5. Promising a rate or an approval the partner has not issued. Quote payments as estimates.
6. Skipping the scorecard. Without the numbers from the first 90 days, you cannot tell a program that is not working from one nobody is using.

The bottom line

Setting up a dealer financing program is mostly decisions, not paperwork: one partner, the right tier, a payment on every quote, a trained team, and a scorecard. Done in that order, a referral program can start today, and a co-branded program is mostly built by your partner and live in days. It should not cost you anything, and it should pay you in full on funding. If a program you are evaluating misses either of those, keep looking.

Frequently asked questions

How long does it take to set up a financing program for an equipment dealership?

At Five West, the partner application takes about 10 minutes and a fit call about 15. On the 3rd Party Financing tier you can refer your first customer the same day. For Co-Branded and Private Label, Five West builds the apply page and payment tools, trains your reps, and goes live, typically in about 1 to 3 days; your part is a logo, one training session, and a snippet on your website. Every tier starts with a 90-day trial.

Does it cost anything to offer customer financing?

Not at Five West. Every tier is free: no setup fee, no monthly fee, and no application fee for your customers. The customer pays the finance charge, as they would at their own bank. The only cost a dealer can choose to take on is a rate buy-down to advertise a promotional rate.

Do I need a license to offer financing to my customers?

Usually not. When you sell your own equipment and a direct lender funds the deal, you are a vendor originating a sale, not a fee-charging loan broker, and the funding party handles the credit pull, disclosures, and adverse-action notices. It can be different if you charge the borrower a separate fee for arranging financing, and a few states have their own rules, so confirm your situation with counsel. This is not legal advice.

What is the difference between captive financing and an independent financing partner?

A captive is a manufacturer’s own finance company. It is strong on new units and promotional rates for its brand, and narrower on used equipment, other brands, and credit outside its box. An independent partner finances across brands, new and used, with more than one credit box. Many dealers keep both: the captive for promotions and an independent partner for everything else.

Am I responsible if my customer stops paying?

Not on a Five West program. You are paid in full on funding, you carry no receivable, and the customer’s obligation runs to the funder, not to you. Some programs elsewhere include recourse or repurchase clauses that move that risk back to the dealer, so read any program agreement before you sign it.

When does the dealer get paid on a financed sale?

Five West pays 100% of the invoice directly to you on funding, after the customer signs and the equipment is delivered and accepted. Where the equipment requires it, deposit funding can be released once documents are signed, with the balance on delivery. Funding typically follows in as little as 24 to 48 hours after documents are signed.

Can I offer 0% financing to my customers?

Yes, through a rate buy-down: you or the manufacturer pay the finance company the difference between the market rate and the advertised rate. It costs about the same as an equal price discount, so it makes sense where a low payment sells better than a lower price.

Does applying affect my customer’s credit score?

Not with Five West. Customer applications use a soft credit inquiry, so applying does not affect the customer’s credit score.

Keep reading

More for dealers, distributors, and manufacturers.

Vendor financingWhy should equipment dealers offer financing to customers?What changes when financing happens at your counter: close rate, average ticket, and cash flow. Vendor financingCould your financing partner do better?Six signs your current partner is costing you sales, and how to audit it. Vendor financingHow to offer financing options online to your customersA payment on the quote and an apply button where customers already are.

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This article is general information about commercial equipment financing and vendor programs. It is not a commitment to finance, and it is not tax, legal, or accounting advice. All financing is subject to credit approval and underwriting.