LeaseSource, Inc | Lease Vs. Buy

Providing equipment and software financing since 1989

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Home > Why Lease > Lease Vs. Buy

Banks definitely have their place. If you have plenty of cash, if you want a good rate on a home loan, or if you already have an extensive line of credit, the bank may be your first choice. But please keep in mind: banks do have their limitations! LeaseSource, Inc. offers equipment leasing, software leasing, computer leasing, government leases and business loans at competitive rates.

We want to help you make a completely informed decision regarding leasing versus buying with a typical bank loan. If you’re about to make an equipment purchase, please consider the following. LeaseSource, Inc. offers equipment leasing, software leasing, computer leasing, and business loans at competitive rates. Please read the chart below to find out why leasing is the way to go. Then, call LeaseSource!








Interest Rates	Floating rates can go sky-high	Fixed rate with fixed payments
Credit effects	Reports all credit issuance to the major credit bureaus. Effects future borrowing power.	Reports only of the borrower does not pay as agreed. Minimizes effects.



Terms	Usually 2-3 years; loan must be reduced to zero balance annually	Up to 10 years



Opportunity Costs	Ties up bank lines, thus prohibiting future investment	Frees bank lines and cash for future investments



Requirements	Financial statements required on almost all transactions over $10k; often requires annual updates to maintain loan	Financial statements not required for most transactions up to $100k (or more for some health care providers)



Down Payment	Typically 20% to 30% required	100% financing available



Hidden Costs	Compensating balances, other bank charges, loan covenants	None. No lease termination fee.



Effective Cost	High due to longer depreciation schedule, larger down payment, adjustable interest rate, and other $$$	Low due to tax benefits, no down payment, longer lease term, and no ompensating balance requirement



Soft Cost Coverage	Cannot finance shipping, tech support, maintenance, etc.	All soft costs can be financed



Sales Tax	Must be paid in advance	Financed within monthly payment



Tax Benefits	Depreciated over the IRS’ useful life of the equipment	Usually 100% deductible over the lease term



Expensing	Can only expense depreciation and interest	Can expense 100% of the payment



Financial Reporting	Carried on balance sheet as debt	Not required to be reflected on balance sheet as debt

Let LeaseSource, Inc., handle all of your business financing needs. Need a business loan? Looking for equipment leasing, computer leasing, software leasing, government leasing, or other equipment lease? Want a working capital loan? Look no further! LeaseSource is YOUR leasing company, here to assist you with the financial services you need to help your business grow.