How to compare equipment finance quotes

Why two quotes for the same thing differ

A repayment is not a single number someone picks. It is built from a handful of things, and a difference in any one of them changes what you pay. Before you compare two quotes, it helps to know what is moving underneath them.

The main levers:

• The amount financed. Not just the equipment price, whether fees, delivery, install or extras are rolled in changes the figure.
• The term. A longer term means lower repayments but more of them. A shorter term costs more each month and less overall. Two quotes over different terms are not really comparable until you line the terms up.
• The deposit or trade-in. More in at the start means less financed, and a lower repayment. Check whether both quotes assume the same.
• A balloon or final payment. Some structures keep repayments lower by leaving a larger amount owing at the end. That is not wrong, but it changes the shape of the deal, and a quote with a balloon will look cheaper month to month than one without.
• Fees. Establishment, documentation, account or PPSR fees vary. A lower repayment with higher fees can cost more than it looks.
• Your business profile. How long you have traded and your circumstances affect what a lender offers. The same equipment can be quoted differently to two different businesses.

None of these make one quote better than another on its own. They just mean you cannot compare by the monthly figure alone.

How to line two quotes up

Put the two quotes on the same basis, then compare:

• Same term? If not, you are comparing different things. Match the terms before you judge the difference.
• Same amount financed? Check what each one includes. One might bundle install and fees the other leaves out.
• Same structure? A balloon deal and a no-balloon deal will not match month to month even at the same rate. Compare like with like.
• All the fees listed? Add them in. The real cost is repayments plus fees, not repayments alone.
• What do you own at the end? Own it outright, owe a final payment, or hand it back. That changes the value of the whole deal, not just the monthly cost.

Once both quotes are on the same footing, the real difference shows, or you find they were closer than they first looked.

Why one quote looks cheaper than another

This is the question most people are really asking, and the answer is usually one of the levers above, not a better deal. A quote can look cheaper because it runs over a longer term, carries a balloon that leaves more owing at the end, assumes a bigger deposit, or simply leaves some fees off the headline figure. A lower monthly number can cost more across the whole deal.

So when one quote looks cheaper, the useful question is not “which is lower” but “cheaper how.” Once you know which lever is doing it, you can see whether the saving is real or just moved somewhere you have not looked yet.

Why the rate is not the cost

The interest rate is the number most people compare first, and on its own it is the most misleading one. A lower rate can still come with a higher monthly repayment, because the rate is only one input. Fees, how the rate is applied, and what is bundled into the amount financed all move the repayment on their own. So a quote can advertise a lower rate and still cost you more each month.

The number that actually leaves your account is the repayment. Compare that, over the same term and the same amount financed, and the rate sorts itself out. If one quote has a lower rate but a higher repayment, the rate was never telling you the whole story.

What we will not tell you

Which quote to take. That is your call, and it depends on what suits your business, not just the numbers. What we can do is help you see what you are comparing, so the decision is yours and well informed.

Compare it against ours

The simplest way to sanity-check a quote is to put another one next to it on the same basis. You can get a real indicative figure from us in about two minutes, for the same equipment and term, and compare it against what you are holding. It is one more data point, no obligation to move, and it tells you where your quote sits.

If you would rather talk it through, one of our brokers will walk you through the levers and what to line up, with no pressure either way.