4 Logical Reasons to Lease Your Equipment

4 Logical Reasons to Lease Your Equipment Owning and operating a business is a rewarding experience, but there will be times when growing pains can hinder your experience. At times like these, a little financial boost is often enough to get a business back on a growing trend. A loan can help when renovating, tying you over through seasonal lows, covering operating and overhead costs, or just about anything else a business might need a little cash infusion to cover.

Choosing to lease your equipment instead of buying it comes with added benefits that may not seem obvious initially. In this article, we are going to discuss four solid reasons why you should prefer leasing your equipment instead of buying it in full payment. So, without further ado, let’s begin!

1. No Instant Pressure of Full Payment Unless there is an investor with very, very deep pockets, it’s likely that someone starting up or expanding their work will need to consider financing in different aspects of the business. In several cases, equipment is the single most important investment they will make. It must be of the highest quality, and durable enough to withstand heavy use while staying reliable for years to come.

When you lease your equipment, the borrowing costs are low and less money is due upon signing. Some companies offer the option to trade up during the lease, with easily negotiated new terms that calculate the trade-in value of the equipment and the difference in costs.

2. You Can Still Own Your Equipment Several equipment-leasing companies offer a lease-to-own program.

At the end of your lease term, you may exercise your purchase option, which is a one-time payment that can be structured as either a percentage sum of your original equipment cost or a flat payment of a

few dollars. Once this purchase option is executed, the title and ownership of the equipment will be transferred to you, which means that you then own the equipment free and clear.

3. Tax Savings Leasing is a 100% legal method of reducing tax bills. In most cases, lease rental is completely tax-deductible, and all payments made for the equipment are written off against the company’s tax bill. For any profit-making business, this means a substantial saving in the real cost of acquiring equipment by lease rental.

4. Equipment Replacement Becomes Easy When you buy equipment, you will have to bear the cost of depreciation along with it. This is where leasing proves considerably profitable in that you don’t have to suffer the cost of the depreciated equipment. Additionally, once you have completed your lease term, you can easily sell off your equipment if it is of no use to you for any longer.

All things considered, financing comes out as a clear winner when pitted against buying in most cases. However, in the world of small business alternative lending, there are a few things to keep in mind to avoid becoming trapped in debt for years. Understanding how lenders earn income and knowing what to look for in a lender can help save tens of thousands of dollars.

Just be careful about who you choose to borrow from and contact only the most dependable lender in your area to learn more about the products and services that best suit the unique needs of your business.

And if you’re interested in a lease-to-own program through a reliable Canadian equipment financing company, contact Vendor Lender today!