Equipment Leasing Guide
According to the Equipment and Leasing Finance Association, more and more businesses are using leasing as an alternative to traditional bank financing. In an industry that continues to grow, businesses lease over $500 billion in capital assets and equipment every year.
- Avoid Obsolescence
Stay current with the latest equipment, especially when it’s new technology or industry specific tools and gadgets. With manufacturers updating and refining quickly from version one, some tools are too expensive to buy since they’re quickly out of date.
- Get It Fast
Vendors don’t benefit from having unleased equipment on their lot in their warehouse, so they’re eager to help you find something that works for your business.
- Cash Flow
Most vendors won’t expect you to drop a huge down payment on your equipment leasing contract, freeing up capital to be used where your business needs it most.
- Total Cost of Financing
If you want good interest rates, go to a banking institution. The flexibility leasing provides to move with technology comes at a cost. While your contract may not include interest, there are likely to be costs and fees if you break or upgrade your service mid-contract.
- Not Everything is Tax Deductible.
If you need your lease to be tax deductible, take your lease agreement to your tax preparer and have them confirm which deductions your lease is eligible for before you sign.