Equipment Leasing Versus Equipment Loans
 |
Equipment Lease | Equipment Loan |
| Requires a significant downpayment? | No | Yes |
| Secured with collateral? | No. The equipment itself is collateral. | Yes. Additional assets are often required. |
| Who bears the risk of equipment obsolescence? | The lessor | The end-user |
| Can claim tax deductions? | The entire lease payment can be claimed under most types of leases | The end-user may claim tax deductions for depreciation and interest. |
| Recorded on the balance sheet? | With an operating lease, the equipment does not appear as an asset. | Equipment is recorded as an asset and liability. |
| Effect on cash flow? | Lease payments are generally spread out comfortably over time | The initial downpayment and strict repayment schedule can put a strain on cash flow. |
To learn about the different lease options and payment plans available at Capital Funds Leasing, contact us online or call 1-877-711-5327 to speak with one of our financing specialists.
