# OEM Captive vs Bank Canonical URL: https://fundmyequipment.com/learn/compare/captive-vs-bank/ Last modified: 2026-05-29T19:39:17+00:00 Type: efin_comparison ## Summary OEM Captive vs Bank. Side-by-side comparison with cost analysis, tax implications, and when each wins. ## Content OEM captive financing (Caterpillar Financial, John Deere Financial, Volvo Financial Services, etc.) and bank/independent financing both fund equipment purchases but serve different scenarios. Captives often have promotional rates on new equipment; banks have broader programs across all manufacturers. Comparison OEM captiveBank or independent lender Brand restrictionsOnly finances that OEM's equipmentFinances any brand Used equipmentTypically limited to certified-used or in-program unitsWide acceptance of used Promotional rates0% APR or low APR available periodicallyStandard market rates Underwriting flexibilityStricter (typically prime-credit only)Wider range, including sub-prime SpeedFast at dealer; integrated with sale1-7 business days Mixed-fleet financingSingle OEM onlyYes, mixed-brand portfolios Equipment trade-inStreamlined within OEMPossible but separate process When captive wins Promotional financing on new equipment. 0% APR for 24-36 months is common in slow seasons. Hard for bank financing to beat the math. Single-brand fleet. If you only run Cat or only run Kenworth, the captive's relationship value and trade-in process compound over multiple purchases. Speed at dealer. Some captive applications integrate with the dealer's order system; sign equipment paperwork and financing in the same closing. Lease residuals. Captives sometimes offer aggressive residuals on FMV leases because they can remarket through dealer network. When bank/independent wins Mixed-brand fleet. If you run multiple OEMs, one independent lender can finance the entire fleet. Used equipment. Independents finance used (any brand, any age within program limits) more readily than captives. Sub-prime credit. Captives are typically prime-only. Independent and bank financing has sub-prime programs. Soft costs / mixed-use. Independents may finance equipment + soft costs (delivery, install, training) more flexibly. No brand restriction at the dealer. If a captive's promotional offer expires or you do not qualify, an independent lender still has options. Watch the captive promotional fine print 0% APR offers from OEM captives almost always have conditions: Specific equipment models only (in-stock, slow-moving inventory) Strong credit required (typically 720+ FICO) Short term (24-36 months rather than 60+) Limited down-payment options (often 10%+ required) Cannot combine with other promotional discounts Higher equipment price sometimes (the discount is "baked into" the rate) Always ask: "What is the cash price?" Compare cash price + bank financing rate to captive promotional financing on the same equipment. Sometimes the bank deal saves more. How to actually shop Get a quote from the OEM captive at the dealer Get the cash price (not promotional financing price) for the same equipment Get a soft-pull quote from a bank or independent lender Compare total cost of ownership: cash price - cash discount + financing cost, vs promotional financing price + 0% APR cost Choose the lower-total-cost path Apply for an independent-lender quote at /apply/.