Fast Business Loan VS. Equipment Leasing

Are you shopping for equipment leasing options or trying to get approved for a business loan?

Business owners who are looking for ways to expand their business often run into roadblocks due to a lack of funds or accessible cash flow.

So, where does a business owner go to get the financing they need to grow their business?  

Bank loans for some can be difficult to obtain if they don’t have excellent credit and enough time in business. 

Related Article: How to Get Equipment Financing for Your Business

Investing your own money is risky and can drain your funds quickly. Experts advise business owners to avoid investing all of their own money into their business and instead seek funding through a financial institution or outside investors.

Equipment Financing is a perfect vehicle for business owners who do not have excellent credit or have a long history of being in business. Equipment Financing, depending on how you structure the loan/lease is the best avenue to build credit and get the equipment you need to grow your revenue. The best part of equipment financing is that they are self-secured. The equipment itself will be used as collateral. 

Here are 5 advantages of equipment leasing:

  • Flexible down payment
  • Easier qualification than bank loans
  • Tax benefits
  • Quick approval
  • Less paperwork

Every situation is different and there’s a lot of factors that need to be considered when trying to figure out which solution suits your company. Depending on your business goals a lease might make more sense than a loan due to the tax benefits that a lease offers.

In a loan scenario that is financed over four years, you can write off the depreciation in an equipment lease scenario or the whole payment can be written off as an operating expense resulting in a significant tax advantage! For business owners that use heavy machinery, this can add up very fast.

Related Article: Semi-Truck Financing Requirements

Getting a fast business loan through an alternative lender such as KapitalVenture is easier than going through a bank, and you don’t need to lower your company funds to pay or buy outright.

Luckily you have options.  If you’re looking to purchase or lease business equipment, we can help! Our Finance Specialists are available to walk you through every step of the process. Call our office today, 737-717-3100 or contact us here.

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