Leasing is often the right structure for businesses that want lower monthly payments, off-balance-sheet treatment, or the option to upgrade equipment at the end of the term.

Structures available through our lender network:

• Operating Lease. Lower monthly payments, with the lender retaining residual value at the end of the term. Typically used when the business does not want long-term ownership of the equipment.
• Fair Market Value (FMV) Lease. End-of-term options to purchase the equipment at fair market value, renew the lease, or return the equipment. Common for technology and equipment that depreciates quickly.
• $1 Buyout Lease. Full ownership transfers to the business for a nominal payment at the end of the term. Functionally similar to a finance agreement, with lease-style accounting.

Typical lease terms range from 24 to 72 months. Specific terms depend on the lender, the equipment type, and the business profile.

An Equipment Finance Agreement (EFA) is a fixed-term financing structure in which the business owns the equipment from day one. The lender holds a security interest in the equipment until the financing is paid in full.

EFAs are typically chosen by businesses that:

• Want to own the equipment outright and depreciate it on their balance sheet
• Plan to use the equipment well beyond the financing term
• Prefer predictable monthly payments with a clear payoff date
• Want to claim Section 179 deductions in the year of purchase

EFA terms typically range from 24 to 72 months, with monthly or quarterly payments depending on the lender and the business’s cash flow profile.

Some equipment finance lenders offer combined packages that include the equipment financing plus an additional working capital component — usually structured as a separate financing line that funds in parallel with the equipment purchase.

This structure is useful for businesses that need:

• Operating capital to cover installation, training, or ramp-up costs
• Inventory or supplies that work alongside the new equipment
• Bridge funding between equipment delivery and the equipment generating revenue

Working capital components vary widely by lender. Some are structured as separate financing facilities; others are credit lines. The terms and approval process are independent of the equipment financing, even when both are offered by the same lender.

Section 179 of the Internal Revenue Code allows qualifying businesses to deduct the full purchase price of qualifying equipment in the year of purchase, rather than depreciating it over multiple years. The deduction limit and qualifying criteria are set annually by the IRS.

Equipment financed through our lender network can be structured to qualify for Section 179 treatment, including financing transactions in which the business does not pay the full equipment cost upfront. To qualify, the equipment generally must be:

• Purchased and placed in service within the same tax year
• Used for business purposes more than 50 percent of the time
• New or used (Section 179 applies to both)

Section 179 is a tax matter. Kensley does not provide tax advice. Consult your CPA or tax advisor to confirm eligibility and benefit for your business.

Through our lender network, we can arrange financing for a wide range of commercial equipment:

• Commercial vehicles — box trucks, sleeper cabs, day cabs, dump trucks, refrigerated units, work vans
• Trailers and chassis — dry van, refrigerated, flatbed, lowboy, tanker
• Restaurant equipment — commercial ovens, fryers, refrigeration, dishwashers, ice machines, POS systems, dining furniture
• Medical and dental equipment — imaging systems, ultrasound, dental chairs, lab analyzers, sterilization equipment, exam room build-outs
• Construction equipment — excavators, skid steers, loaders, lifts, generators, attachments, light and heavy duty
• Manufacturing equipment — CNC mills and lathes, presses, conveyors, automation, packaging lines, robotics
• Office and technology — servers, networking, audiovisual systems, specialized software

If the equipment supports a commercial business operation and the cost falls within typical ranges ($10,000 to $500,000+), we can usually find a lender match. Larger or specialty equipment is reviewed on a case-by-case basis.