Asset finance

Forklift finance for warehouses, yards and distribution sites

How UK businesses fund counterbalance, reach and VNA forklifts, and how truck hours, batteries and contract length shape the right finance.

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In short

Forklift finance spreads the cost of counterbalance, reach, very narrow aisle and pallet trucks over monthly payments, usually through hire purchase if you will keep the truck, or contract hire if you want maintenance bundled and a planned replacement date. Lenders value a forklift much like a van: by make, age and hours on the clock. They also want the term to fit the work the truck is committed to.

This page is for warehouse operators, third-party logistics firms, manufacturers, builders merchants and wholesalers who need one truck or a whole materials-handling fleet without paying for it from working capital. Smart Funding Solutions is a broker, not a lender: we approach lenders on our panel of 300+ that finance materials-handling equipment, and arrange facilities from around £10,000 to £500,000+, with larger facilities available in suitable cases. Forklift finance sits within our wider asset finance options.

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Truck type, hours and batteries

Lenders treat forklifts differently depending on how easily they could be resold, and that affects the term and deposit offered.

Counterbalance, reach and VNA

Diesel, LPG and electric counterbalance trucks from established manufacturers have a deep second-hand market, so they are the simplest to fund, new or used. Reach trucks are also widely traded. VNA and turret trucks are often specified to a particular building's aisle width, lift height and floor, which narrows the pool of buyers if a lender ever had to sell one. Expect lenders to look harder at the business, and sometimes to ask for a larger deposit, on highly specified trucks.

Hours are the mileage

A forklift's hour meter does the job a van's odometer does. A used truck with modest hours and a full service record is worth considerably more than the same model worked across three shifts. For contract hire, the hours allowance in the agreement matters: running trucks harder than agreed can mean excess-hours charges at the end.

Lead-acid or lithium-ion

Electric trucks run on either lead-acid batteries, which are cheaper but need changing or charging in a dedicated area, or lithium-ion, which cost more upfront but allow opportunity charging during breaks. The battery can be a large share of an electric truck's price and a replacement battery is a significant cost later in the truck's life. Check whether the battery and charger sit inside the agreement or are financed separately, and who owns the battery at the end.

Fuel type follows the site rather than the finance: diesel suits rough outdoor yards and heavy loads, electric suits indoor warehouses and food or cold-store work, and LPG suits sites that move between the two. All three can be funded through the same routes.

Attachments such as side-shifts, fork positioners, rotators and clamps can usually be included in the same agreement.

When businesses finance forklifts

The trigger is rarely "we need a forklift". It is usually something more specific, and the trigger shapes the right structure.

A new warehouse contract. A logistics operator wins a client and needs trucks for exactly the length of that client agreement. Matching the finance term to the contract avoids paying for trucks after the work has gone.
A move to a taller or narrower building. Higher racking and tighter aisles mean moving from counterbalance trucks to reach or very narrow aisle (VNA) trucks, which cost considerably more and are specified to the building.
Replacing trucks at the end of their economic life. Once hours climb, repair bills and downtime rise. A planned replacement cycle lets you budget instead of reacting to breakdowns.
Switching from diesel or LPG to electric. Often driven by indoor air quality, noise or a customer's sustainability requirements, and usually involving chargers and site electrical work as well as the trucks.
Ending expensive rental. A truck hired "temporarily" two years ago and still on site is often costing more than finance would.

For yard and site machines with a telescopic boom, see our guide to telehandler finance; for road vehicles, vehicle fleet finance.

Running costs to build into the numbers

The finance payment is only part of the cost of keeping a truck working safely. Under the Lifting Operations and Lifting Equipment Regulations, a forklift needs a periodic thorough examination by a competent person, separate from routine servicing. Operators need training, and HSE guidance on managing lift trucks covers the site and supervision duties that come with running them. Add tyres, battery care, damage repairs and, for diesel and LPG trucks, fuel. Contract hire can bundle much of this into one payment; on hire purchase it all sits with you.

Illustration: fleet for a new contract

Illustration. A distribution business wins a five-year storage contract that needs six electric reach trucks and two counterbalance trucks for the loading bays, a package of roughly £300,000 including chargers. The reach trucks are specified to the client's racking, so contract hire over the life of the client agreement means they go back if the contract is not renewed. The counterbalance trucks will be useful on any site, so hire purchase lets the business keep them as owned assets. Splitting the package this way keeps the specialist risk with the contract and the general-purpose trucks on the balance sheet. The numbers are hypothetical and each lender sets its own terms.

Risks and trade-offs

Finance costs more in total than buying outright, and a truck on hire purchase can be recovered by the lender if payments stop. Contract hire looks cheaper month to month, but return conditions, excess hours and damage charges can add up, so read the return standard before signing. A common and costly mismatch is a long agreement on trucks tied to a short customer contract: if the work goes, the payments do not. If the need is genuinely seasonal, rental through the peak is often cheaper than a fixed agreement. For businesses with a thin or damaged credit record, our guide to bad credit asset finance explains what lenders will consider.

Underwriting

What lenders look at

Truck and supplier

make, model, age, hours and specification, bought from a dealer who can confirm ownership and service history.

Term against use

whether the term fits the work the truck is committed to and ends within its useful life; terms of three to five years are common, depending on the lender and the truck.

Customer contracts

for logistics operators, how long the client contracts run and how dependent the business is on one customer.

Trading and affordability

filed accounts, recent management figures and bank statements showing the payments are comfortably covered.

Existing finance

other hire purchase, lease and loan commitments already on the books.

Credit record

business and director history; directors of smaller companies are often asked for a personal guarantee.

Checklist

Documents you will need

Dealer quotation or pro forma invoice with the truck specification, battery and attachments listed
For used trucks: year of manufacture, hours reading, serial number and service history
Latest filed accounts and, for larger facilities, current management accounts
Three to six months of business bank statements
A schedule of existing finance agreements
For contract logistics: a summary of the customer contract the trucks will serve
Director identification and address details

Side by side

Compare your options

How the main business finance structures work. Lenders set their own terms, so treat this as a guide to the questions to ask.

Option	How you repay	Security	Often used for
Unsecured business loan	Fixed instalments, usually monthly	No charge over assets; a personal guarantee is usually required	Growth, stock, tax bills and cash flow
Secured business loan	Fixed instalments, often over a longer term	A charge over property or other assets	Larger sums, property and refinancing
Revolving credit facility	Interest on what you draw; repay and redraw	Varies by lender and case	Recurring or uneven cash flow gaps
Merchant cash advance	A share of future card takings	No charge over assets	Card-taking businesses with uneven months
Asset finance	Regular payments over the life of the asset	The asset being financed	Equipment, vehicles and machinery
Invoice finance	Settled as customers pay their invoices	Your unpaid invoices	Businesses waiting on customer payment

General information only. Every lender has its own criteria, and all finance is subject to status.

Ways to fund a forklift

Route	What happens at the end	Best fit	Trade-off
Hire purchase	You own the truck after the final payment	Counterbalance trucks you will run for many years	Servicing, repairs and thorough examinations are your cost
Finance lease	Continue renting at a low rental, or the truck is sold and you share proceeds as agreed	Lower payments when ownership does not matter	You never own it; end-of-lease terms vary by lender
Contract hire	Hand the truck back or replace it	Fleets on a fixed cycle, contract logistics	Hours allowances and damage charges at return
Short-term rental	Off-hire when the need ends	Seasonal peaks, trials, short contracts	Costs more per week than finance if kept long-term
Refinance or sale and HP back	You own the truck again after repaying	Releasing cash from trucks you already own	Adds borrowing against kit that is already ageing

Hire purchase and leasing differ in tax and VAT treatment as well as ownership; our guide to hire purchase vs leasing goes through this, and asset finance and capital allowances explains how the tax relief works. To raise cash from trucks you already own, see asset refinance.

How we arrange forklift finance

You send us the dealer quote and tell us how and where the trucks will work.
We suggest a structure, including whether to split owned and hired trucks.
We approach lenders on our panel that fund materials-handling equipment of that type and age.
We compare the offers with you: deposit, term, hours allowances, battery treatment and end-of-term options.
The chosen lender underwrites, you sign, and the lender pays the dealer before delivery.

Lenders make the final decision. It is free to enquire; any broker fee is disclosed separately before you proceed. Warehousing operators may also find our transport and logistics finance and wholesale business finance pages useful, and you can start an enquiry online with a quote to hand.

FAQs

Questions clients ask

Can a new or small business get forklift finance?

Often, yes. Because the truck is security, lenders can be more flexible than for unsecured borrowing. A newer business may be asked for a larger deposit or a personal guarantee, and a well-known counterbalance truck is easier to fund than a specialist one. Borrowing of £25,000 or less by sole traders and small partnerships can be regulated consumer credit, which brings additional protections.

Can I finance a used or ex-rental forklift?

Yes, provided the dealer can confirm age, hours, serial number and service history. Older trucks tend to attract shorter terms. Our page on used equipment finance explains how lenders assess second-hand kit.

Can chargers and site electrical work go into the same agreement?

Chargers usually can, as they are identifiable equipment. Electrical installation work has no resale value, so some lenders will include it only as a modest part of a wider package, and others will not include it at all.

Is it better to finance through the forklift dealer?

Dealer finance can be convenient, and manufacturer-supported offers are sometimes good value. Compare the total repayable, check whether a cash buyer would get a better truck price, and check whether the agreement ties you to that dealer for servicing.

Can forklift finance include servicing and maintenance?

Yes, some forklift agreements bundle servicing and maintenance into the rental, usually contract hire or operating lease arrangements where the truck goes back at the end. With hire purchase or a finance lease, servicing, repairs and thorough examinations are normally your cost. A maintenance package makes the monthly figure higher but more predictable, so compare the full running cost rather than the finance payment alone.

Keep exploring

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