Lease Equipment Without Buying It Outright

How Equipment Leasing Works

Similar to the purchase process, you’ll first need to identify the asset. Then, instead of purchasing machinery outright or financing it, you’ll enter into a lease agreement and make scheduled payments over an approved term.

Types of Leases

When it comes to equipment leasing, there are two main types of leases available to qualified applicants. Determining which type works best for your needs will help streamline your application process significantly:

Capital Lease

With a capital lease, you are responsible for paying the insurance and equipment maintenance costs during the lease period. You can list the machine as a liability on your taxes and write off the depreciation and the interest you pay.

Operating Lease

Under an operating lease, the owner pays for the maintenance of the machine. While you can’t claim the equipment as a liability for your taxes, you can deduct operating lease payments as an operating expense.

What Documents Are Needed To Lease Equipment

To secure the lease, you’ll need to provide details about the equipment or other assets and their intended use, as well as provide your financial and business information to lenders or financing partners. The factors they may review can include:

Equipment Type

Estimated Value

Condition

Lease Structure

Applicant's Qualifications

What The Leasing Agreement May Include

If your lease application is approved, the agreement will define the key terms of the agreement, so you understand your responsibilities and other important lease details:

Payment Amounts

Term Length

Asset's Intended Use

Available End-Of-Term Options

End-Of-The-Term Leasing Options

Depending on the lease structure, options at the end of the term vary between:

Returning The Equipment

Renewing The Lease

Upgrading To A Different Machine

Purchasing The Asset

Reviewing those types of leases and leasing terms upfront can help determine whether leasing fits your long-term goals, current needs, and cash flow. Ready to start the process now? Learn how to lease equipment through CurrencyFinance.

Who Equipment Leasing May Be Right For

Equipment leasing may be a fit for businesses or qualifying individuals who need to access machinery as soon as possible but don’t have the funds to purchase or finance the asset or have other priorities and want to have their future options open at the end of the term.

Some scenarios where equipment leasing is a working option include:

• A warehouse owner leasing forklifts and other material handling equipment to support increased order volume.
• A roadwork company leasing additional pavers and compactors to complete an urgent project faster than they would be able to with their existing fleet.
• A farmer leasing equipment to support operations during the planting season while preserving cash for other expenses.
• A landscaping business leasing a mini skid steer to evaluate how it fits its business’s daily operations before deciding whether to purchase or finance similar machinery later.
• A construction contractor leasing attachments for specialized jobs that require tools outside of his regular tools.

Leasing needs and options can vary depending on the size of your business, the equipment you need, the lease structure available to you, and other lender requirements. Our dedicated team of leasing specialists can help you understand what may be available for your situation when you reach out.

Explore Equipment Leasing Options

Benefits Of Equipment Leasing

Leasing may be a better option than buying or renting, depending on the equipment, how it will be used, and whether ownership is a long-term plan. Some of the benefits of leasing machinery and other qualifying assets may include:

What To Consider Before Applying For Equipment Leasing

The right lease structure depends on how the equipment will be used, how long it is needed, and what responsibilities are included in the terms. Before you sign any leasing agreement, make sure to review what can affect whether your leasing experience will be successful.

• Maintenance And Insurance Responsibilities

  • Depending on the lease structure, you may be required to handle maintenance, repairs, insurance, and other costs. Review the leasing agreement carefully to know what costs you’ll be liable for.

• Total Cost Should Fit Your Budget

  • Leasing may reduce upfront costs, but payment amounts, renewal terms, and other fees can affect total cost over time. Consider how long you need the equipment and whether leasing, financing, or renting is the best fit.

• Ownership May Stay With The Lessor

  • Depending on the lease structure, your business may not own the equipment during the lease term. Although this can reduce some costs of ownership, it also means you should understand your end-of-term options before signing.

• Tax Treatment Can Be Complex

  • Lease payments, Section 179, and bonus depreciation may be treated differently depending on the lease structure and your business situation. Consult a qualified tax professional to understand what may apply.

"The best lease is the one that fits how qualifying lessees actually plan to use the equipment. Taking time to understand the structure up front can help them avoid surprises later and make a more confident decision."

Kenny Segin, Currency Director

How To Lease Equipment With CurrencyFinance

When you start an application for a capital or operating lease through CurrencyFinance’s online process, you’ll provide information about the equipment, lease amount, contact details, and business profile, including business history and creditworthiness. Here’s what to expect when exploring equipment leasing through CurrencyFinance:

• Identify the equipment you want to leaseShare details about the machinery, vehicle, trailer, or other asset your business needs.
• Provide lease and business informationSubmit the requested equipment, lease amount, contact, and business details through CurrencyFinance’s online application process.
• Work with CurrencyFinanceA CurrencyFinance representative will review your information and help identify available leasing options based on your equipment needs and business profile.
• Compare available termsReview potential lease structures, payment terms, and end-of-term options before deciding which path works best for your business.
• If approved, finalize your lease agreementComplete the required documentation and move forward with the lease option you accept.

Qualified applicants may be eligible for funding up to $500,000, with some approvals completed quickly, depending on lender requirements, equipment details, and applicant profile.

Reach out to our financing experts with any questions about the equipment leasing process.