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Conclusion

Leasing equipment is a good way for businesses to acquire expensive equipment without needing to purchase it. That makes leasing good for cash flow and popular for businesses that want the option to upgrade their equipment regularly. Before leasing any equipment, work with a lawyer to make sure the lease agreement is properly constructed.

If you're still not sure whether you'd like to lease or purchase equipment for your business, read our article about equipment financing vs. leasing to learn more. 

FAQ

How is insurance handled in an equipment rental agreement?
The lease agreement will outline how insurance is handled, such as whether the lessee or lessor covers the cost.
Is it possible to get out of an equipment lease agreement?
In many cases, it is possible to get out of a lease agreement, but you may have to pay penalties. Read the fine print or consult a lawyer to see what your options are.
Where can I find an equipment lease agreement template?
You can find equipment lease templates online or consult a lawyer who may offer one.
How does a lease-to-own agreement differ from typical equipment rental agreements?
Lease-to-own agreements give the lessee the option to purchase the equipment at the end of the deal, often with a credit toward the purchase price for a portion of the lease payments. Typical equipment rental agreements don’t have that option.
Are lessees financially responsible for more than just their monthly lease payments?
Depending on the terms of the agreement, lessness might be responsible for things like routine maintenance and insurance costs.

About the Author

TJ Porter

TJ Porter

Personal Finance Writer

I have in-depth experience in reviewing financial products such as savings accounts, credit cards, and brokerages, writing how-tos, and answering financial questions both simple and complicated.

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