Buying a piece of heavy equipment is often a challenge for many companies, especially the ones that are just making their mark in the business. Any construction or infrastructure equipment has heavy cost attached to it and companies thus look for financers to procure these products. With some of the most professional lenders willing to lend for heavy equipment your job as a company becomes easier. What you need to decide on is whether to go for equipment lease or equipment loan.

Buying a piece of heavy equipment is often a challenge for many companies, especially the ones that are just making their mark in the business. Any construction or infrastructure equipment has heavy cost attached to it and companies thus look for financers to procure these products. With some of the most professional lenders willing to lend for heavy equipment your job as a company becomes easier. What you need to decide on is whether to go for equipment lease or equipment loan.

If you have the first look you will find that equipment lease looks a better arrangement than taking a loan. When you lease a piece of equipment the arrangement is like a rent. In this arrangement a specific term is decided by the borrower and the lender and the borrower continues to pay for the lease of the equipment till the end of the contracted period. At the end of the term the borrower may decide to purchase the equipment or return it to the lender. When you get a professional lender for leasing a piece of equipment there is no need for you to make any down payment. Usually leases involve 100% financing for the cost of the product.

The other advantage of equipment lease is that you as a lender need to pay a much lower amount per month than you would if you take an equipment loan. The borrower will have the title to the equipment and the two of you may mutually decide to keep it that way at the end of the lease or transfer the title to your name.

An equipment loan, on the other hand, is similar to a secured loan. Here the title of the equipment belongs to you and you make monthly payments to the lender till the end of the loan term. This means that the equipment continues to be yours when the loan is paid off. However, till the time the loan is paid off the lender uses the equipment as collateral. There is also the possibility of using some other asset of your business as collateral. Usually there is a down payment needed to take this loan. The biggest advantage of this loan is that you get a tax benefit on the interest you pay to the lender.

Both equipment lease and equipment loan have their benefits and it is you who needs to decide whether to take a lease or a loan. The best thing to do is to contact your accounts advisor who can take the appropriate call based on the current status of your business. At the same time you should also do some research online and find out about both of these arrangements.

Both the equipment lease and the equipment loan help you manage your cash balance. You don’t need to invest all your money on these expensive pieces of machinery and yet you get to use them like they are yours only. A professional lender will be able to give you great terms on both these arrangements.

 

You may need to choose between equipment lease http://mybanksaidno.com/business-loans/equipment-finance/ and equipment loan http://mybanksaidno.com depending on the best deals available.