Refinancing Equipment 2026 - Unlock Equity Guide

Own equipment but need cash? Refinancing lets you unlock equity without selling. Here’s the 2026 guide.

What is Equipment Refinancing?

Refinancing means:

• Borrow against owned equipment
• Get cash for business use
• Keep using equipment
• Flexible repayment terms

Why Refinance Equipment in 2026?

Common Reasons:

• Business expansion
• Working capital needs
• Emergency expenses
• Debt consolidation
• New equipment purchase
• Contract opportunities

Refinancing vs New Financing

Feature	Refinancing	New Financing
Equipment Status	Already owned	New purchase
Cash Received	Up to 80% value	100% of price
Interest Rate	Lower (secured)	Standard rate
Approval	Faster	Standard process
Equipment Age	Important factor	Less important

How Much Can You Refinance?

Equipment Value Factors:

1. Current market value - Not original price
2. Age and condition - Newer = higher %
3. Type of equipment - Excavators = higher value
4. Maintenance records - Well-maintained = better terms Typical Loan-to-Value (LTV):

• New equipment (1-2 years): 70-80%
• Mid-life (3-5 years): 60-70%
• Older (6-10 years): 40-60%

Real Example: Excavator Refinancing

Owned Excavator:

• Original price: RM 200,000 (2 years ago)
• Current value: RM 150,000
• Refinance amount: RM 105,000 (70%)
• Monthly (5 years): ~RM 2,100 Use cash for:
• New forklift purchase
• Working capital
• Hire 2 more workers
• Take on bigger contracts

Bank Refinancing Requirements 2026

Requirement	Bank	Ing Heng
Ownership Period	Minimum 2 years	6 months OK
Equipment Age	Under 7 years	Up to 10 years
LTV Ratio	50-60%	Up to 80%
Documentation	Valuation required	Simple assessment
Approval Time	2-3 weeks	fasts

Equipment We Refinance

High LTV (70-80%):

• Komatsu excavators (PC200, PC300)
• CAT excavators (320, 336)
• Prime movers (Volvo, Scania) Medium LTV (50-70%):
• ISUZU, FUSO, HINO lorries
• Toyota forklifts
• TCM forklifts Lower LTV (40-60%):
• Older equipment (7-10 years)
• Small machinery
• Specialized equipment

2026 Refinancing Benefits

1. Keep Equipment - No disruption to operations
2. Lower Interest - Secured loan rates
3. Flexible Terms - 1-7 year options
4. Fast Cash - Money in fasts
5. Tax Deductible - Interest expenses

Refinancing Process

Step 1: Assessment (fasts)

• Equipment details
• Current photos
• Usage information Step 2: Valuation (fasts)
• Market value check
• Condition assessment
• LTV calculation Step 3: Approval (fasts)
• Documentation review
• Offer confirmation
• Agreement signing Step 4: Payout (fasts)
• Cash to bank account
• Equipment continues use
• Monthly payments start

Documentation Required

1. Equipment proof

• Purchase invoice
• Registration grant (JPJ)
• Insurance policy

2. Business documents

• SSM registration
• 6 months bank statements
• Latest audited accounts

3. Equipment condition

• Current photos
• Service records
• Hours used (if applicable)

Bad Credit Refinancing

Banks may reject if:

• Poor CCRIS score
• Late payments visible
• High debt service ratio Ing Heng considers:
• Equipment value primary
• Income secondary
• Bad credit possible
• Bank rejection cases welcome

Refinancing vs Selling

Why Refinance Instead of Sell?

Factor	Refinancing	Selling
Keep Equipment	Yes	No
Get Cash	Yes	Yes
Business Impact	None	Major disruption
Process Time	3-5 days	Weeks/months
Future Use	Continue	Lost

Real Example: Fleet Refinancing

Construction Company:

• 3 excavators owned
• Total value: RM 450,000
• Refinance 70%: RM 315,000
• Monthly payment: RM 6,300 Use cash to:
• Purchase 2 new lorries
• Hire 5 workers
• Expand to new construction sites

2026 Refinancing Tips

1. Check equipment value first - Get realistic estimate
2. Compare LTV ratios - Higher % = more cash
3. Consider term length - Longer = lower monthly
4. Plan use of funds - Business expansion ideal
5. Maintain insurance - Required throughout loan

Interest Rates 2026

Refinancing Rates:

• New equipment (1-3 years): 4.5-5.5%
• Mid-life (4-6 years): 5.0-6.0%
• Older (7-10 years): 5.5-6.5% Factors affecting rate:
• Equipment age
• LTV ratio
• Business financial health
• Loan term

Get Refinancing Quote

Own equipment that needs refinancing? Contact Ing Heng for same-day assessment and fast cash payout.

Need new equipment? See 0% Deposit Equipment Financing.