What is equipment financing?

Equipment financing is a loan or lease specifically used to purchase or lease business equipment — machinery, vehicles, computers, medical devices, restaurant equipment, and more. The equipment itself serves as collateral, making it easier to qualify than unsecured loans. Equipment loans typically cover 80%–100% of the equipment cost with terms matching the equipment's useful life (1–7 years). Equipment leases allow use of the equipment without full ownership and may have lower monthly payments. Section 179 of the tax code may allow you to deduct the full equipment cost in the year of purchase, providing significant tax advantages.