Equipment Financing Calculator
Lease vs buy vs loan comparison for equipment.
Leasing preserves cash but costs more over time. Buying with cash avoids interest but ties up capital. A loan spreads cost over time. This calculator compares total cost of lease (monthly × term), loan (principal + interest), and cash purchase so you can choose the best option.
Inputs
Results
Cash: $25,000
Lease total: $28,800
Loan total: $30,400
Insights
Formula
Lease total = Payment * Term Loan: PMT = P * [r(1+r)^n] / [(1+r)^n - 1], Total = PMT * n
Input Definitions
What does each input mean?
- Equipment cost
- Purchase price. Cash option pays this upfront.
- Lease payment
- Monthly lease payment. Total = payment × term.
- Lease term
- Months of lease. No ownership at end.
- Loan APR
- Equipment loan interest rate. You own at payoff.
- Loan term
- Months to repay the loan.
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Should You Buy, Finance, or Lease That Equipment?
Equipment financing affects your cash flow, your balance sheet, and your taxes differently depending on how you structure it — and the right answer varies by how long you’ll use the equipment, your current cash position, and your growth plans. This calculator models the monthly payment obligation and total cost of ownership for financed equipment so you can compare it against buying outright or leasing.
It’s essential before any significant equipment purchase: manufacturing machinery, vehicles, medical devices, commercial kitchen equipment, or technology infrastructure. Running the numbers here first helps you negotiate better with lenders, decide whether a loan or lease makes more sense, and ensure that the asset’s revenue contribution will exceed its financing cost.