Equipment Lease Calculator

Before starting your search for the right equipment leasing company , first, know your lease amount! Sit down and and estimate to the best of your abilities, your approximate financing needs. As with any other type of term-debt obligation, you don't want to get in over your head.

Next, determine how long the useful life of the equipment is. When at all possible, match the lease term to the estimated equipment life. You wouldn't want to lease a camcorder for 5-years when you know it's going to be obsolete in 2-years, and you wouldn't want to tie up your funds on a 2-year deal if the equipment will be useful and operational for 7-years.

Remember... new pieces of equipment can generally be approved for longer terms up to 72-months, while used equipment (especially 5+ years) may be restricted to a 36-month term.

Try this 30-second equipment lease calculator to estimate your monthly payments on your next equipment lease or business equipment financing transaction.

Traditional business equipment leasing contracts are structured over 24, 36, 48, or 60-month terms, with various end-options based on your cash-flow and tax requirements:

* $1 OUT- With a "plain English" purchase option, the lessee must purchase the equipment for $1.00 at the end of the lease term. The $1.00 (or $101 for tax purposes in some state) purchase option is also known as a "full payout lease" or a "disguised purchase." This is an ideal option for business that KNOWS they would like to own the equipment at the end of the lease.

* 10% End-option (PUT), is a pre-determined end-option based on 10% of the original financed amount. This allows the lessee to enjoy lower payments through the term of the lease, while still giving them the peace-of-mind knowing they still have a GUARANTEED end-option amount. This is ideal for businesses that know they want to own the equipment at the end of the lease term, but want to enjoy lower monthly payments.

* FMV (Fair Market Value)- A lease structured with a FMV purchase option is perfect for any company seeking the MAXIMUM tax and accounting benefits that an operating lease can provide. Often times, the entire monthly lease payment can be deducted as an operating expense. This can greatly reduce tax liability at the end of the year. A business with a FMV lease has the option to purchase the financed equipment at the end-of-lease, at its current fair market value. FMV leases allow for the lowest monthly payments.