01
Cash flow
The lease discount.
Leasing usually saves meaningfully per month — the result shows exactly how much at your buyout choice. That freed cash flow is the main reason businesses lease instead of buy.
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Should you lease or buy this equipment?
This lease vs buy calculator compares the monthly payment and total cost of leasing, with a buyout, against a loan that ends with you owning the equipment.
Condition
Lease
$1,512/mo
+ $8,500 buyout · $107,695 to own
Loan
$1,622/mo
own it outright · $105,798 total cost
Lease saves monthly$110
Lease costs extra total$1,897
Illustrative comparison only. Lease structures, residuals, fees and loan terms vary by provider and approval. The buyout percentage is an assumption, not a quote.
How it works
Leasing buys time; buying builds equity.
A lease typically lowers the monthly payment by pushing part of the cost into an end-of-term buyout — better for cash flow, useful if you upgrade equipment regularly, and sometimes preferred for tax treatment. A loan costs more each month but ends with an asset you own free and clear. The honest comparison is monthly delta versus total cost: the calculator shows both, plus what each path costs to fully own the machine.
02
Ownership
What the extra buys.
The loan’s higher payment buys equity and zero residual. When the term ends, you own the machine — a real asset that still earns. The lease ends with a decision, not ownership.
03
Total cost
Full price of each path.
Cost-to-own adds the down payment, every monthly payment and the buyout. Compare it to the loan’s total cash outlay — the gap is the true price of the lower monthly payment.
04
Fit
Which side wins when.
Lease leans right for fast-depreciating tech, seasonal fleets and cash-tight operations. Buying leans right for long-life equipment, stable utilization and building balance-sheet assets.
Important questions
Know what to expect.
Is it better to lease or buy equipment?+
It depends on your priorities. Leasing costs less monthly and suits equipment you upgrade often or cash flow you must protect. Buying costs more monthly but builds an owned asset and usually less total over a long hold.
Why are lease payments lower than loan payments?+
A lease only finances the depreciation during the term — the residual buyout sits at the end instead of inside the monthly bill. A loan amortizes the full price, so each payment retires more value.
What happens at the end of an equipment lease?+
Depending on the structure: buy the equipment at the residual or market value, return it, or roll into a new lease on newer equipment. A $1 buyout lease ends with automatic ownership.
Does leasing or buying save more on taxes?+
Both paths have options — bought equipment can use Section 179 and bonus depreciation; lease payments are often deductible as an operating expense. The right answer depends on your situation and a tax professional.
Is this comparison a real offer?+
No — both sides are estimates from the numbers you enter. Actual lease and loan terms come from a financing provider’s review of your business and the equipment.
Financing built into the sale