Financing vs. Leasing: Which Is Right for Your Business?
Both keep cash in your pocket, but they serve different goals. Here is how to choose.
Financing (a loan or EFA) and leasing both let you acquire equipment without paying full price upfront. The right choice depends on how long you will use the asset and whether you want to own it.
Choose financing when you want ownership
With an Equipment Finance Agreement or $1 buyout lease, you own the equipment at the end of the term. Best for assets with a long useful life that hold value.
Choose leasing when you want flexibility
A fair-market-value (FMV) lease keeps payments lower and lets you return or upgrade the equipment at term end. Ideal for technology or equipment you will want to replace.
- EFA / $1 buyout: lowest total cost, you own it
- FMV lease: lowest payment, flexibility to upgrade
- TRAC lease: for titled vehicles and fleets
- PUT / First Amendment: preset purchase options
The good news: you do not have to guess. A modern platform prices all of these side by side so you can compare the real monthly cost of each.
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