Laundry equipment sits in an unusual position. The machines are expensive, they last a long time, they are bolted to utilities in a leased space, and they generate coin or card revenue that is easy to verify. Each of those facts pulls the financing decision in a different direction.
This covers how commercial laundry equipment is financed, why lease structures dominate the category, and the two things that decide your terms.
What gets financed
- Washers — soft-mount and hard-mount, 20lb through 80lb+, coin, card or app-operated.
- Dryers — single and stack pocket, gas or electric.
- Payment systems — card readers, kiosks, mobile app hardware. Increasingly the first thing replaced in an older store.
- Ancillary — water heaters, boilers, folding tables, extractors, POS for wash-dry-fold.
- On-premise laundry — hotels, care homes, gyms and salons run the same equipment for internal use and finance it the same way.
The two things that decide your terms
First, your lease on the premises. This is the single biggest factor and it catches people out. A lender will not write an 84-month term on equipment installed in a space you have 30 months left on, because the asset is effectively immovable once it is plumbed and vented. If your remaining lease is short, extend it before you finance, not after.
Second, whether the equipment is new or a takeover. New equipment from a distributor with a warranty gets the longest terms and the best rates. Buying an existing laundromat’s installed machines is an acquisition, and the equipment portion is usually underwritten differently — often through an SBA loan rather than equipment finance, because much of what you are buying is the location and its trading history rather than the hardware.
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Why leasing is common in this category
Commercial laundry is one of the few equipment classes where leasing is genuinely the default rather than the fallback, for three reasons: distributors offer it directly and price it competitively; the machines outlast most finance terms, so a fair-market-value buyout is often cheap; and store refits tend to be capital events where the deposit matters more than the total cost.
- Capital lease or $1 buyout — in substance a loan. You end up owning the machines. Usually the right choice if you own the building or hold a long lease.
- Fair market value lease — lower payments, and you decide at the end. Suits operators who expect to refit on a cycle or whose premises lease is uncertain.
- Loan — best where you want the asset on the balance sheet from day one and intend to run the machines to end of life, which in this category can be 15 years or more.
On tax, buying with a loan makes you the owner from the start, which opens depreciation and potentially Section 179 — capped for tax years beginning in 2025 at $2,500,000, reduced dollar for dollar once Section 179 property placed in service exceeds $4,000,000. Indexed and revised most years; check IRS Publication 946 and your accountant. Equipment financing vs leasing works through the full comparison.
Typical terms
| Situation | Typical term | Typical deposit |
|---|---|---|
| Established store, new equipment, long premises lease | 60–84 months | 0–10% |
| Established store, shorter premises lease | 36–60 months | 10–20% |
| New operator, first store | 36–60 months | 20%+, personal guarantee |
| Payment system upgrade only | 24–48 months | 0–10% |
| On-premise laundry (hotel, care home, gym) | 48–72 months | 0–15% |
A worked example
An operator refits a store: twelve soft-mount washers and eight stack dryers, plus a card system. Distributor invoice $180,000, with $18,000 (10%) down, quoted 10.5% over 84 months against a nine-year premises lease.
- Amount financed: $162,000
- Monthly payment: $2,731
- Total interest: $67,440
- Total of payments: $229,440
Note what the long term costs: $67,440 in interest on a $162,000 balance. It is affordable per month precisely because it is spread over seven years — which only works because the premises lease runs longer than the finance. Shorten either one and the arithmetic changes. Run your own figures in the equipment loan calculator.
Utilities are part of the decision
Newer machines use materially less water, gas and electricity than the ones they replace, and in a laundromat those are the largest operating costs after rent. When you model whether a refit pays, the utility saving belongs in the calculation alongside the revenue — it is often what makes an otherwise marginal payment work. Ask the distributor for consumption figures on the specific models, not the range.
Frequently asked questions
Can I finance equipment for a laundromat I am buying?
The equipment can be financed, but buying an operating store is an acquisition — most of the value is the location and its takings. That usually needs acquisition financing or an SBA loan, sometimes alongside equipment finance for new machines.
Can I finance used laundry machines?
Yes, though terms shorten and lenders prefer a distributor invoice to a private sale. Used equipment financing covers the rules.
Does financing cover installation and plumbing?
Installation on the distributor invoice can usually be included. Separate plumbing, gas and electrical work by third-party contractors generally cannot, and is better funded from a line of credit.
What to check before you sign
- Does the term fit the premises lease? The one that matters most. If the finance outlasts your right to occupy, you have a problem the lender has already priced for.
- Lease or loan, and which lease? A $1 buyout and a fair-market-value buyout produce very different totals over seven years. Get the end-of-term position in writing.
- Rate or factor rate. Distributor-arranged finance quotes factor rates more often than banks do. Convert before comparing anything.
- Who services the machines, and is it bundled? Some agreements bundle maintenance into the payment. That can be good value or expensive — price it separately to find out which.
- What is filed against you. A blanket UCC filing across all business assets restricts later borrowing; one against the machines does not.
- Landlord consent. Installing financed equipment in a leased space sometimes requires the landlord to acknowledge the lender’s interest. Find that out before closing, not during.
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