Networking Equipment Leasing and Financing
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|Financing Type:||Equipment FinancingWorking Capital|
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|Sample Time in Business:||5+ years|
In order to stay competitive in today’s business world, you have to have reliable networking capabilities. Such capabilities must be built upon the backs of quality networking equipment like routers, gateways, hubs, repeaters, and proxy servers. This hardware comes with a hefty price tag. Choosing to buy it requires a significant investment up front. Even if your company is willing to absorb the expense, consider this: advances in networking technology have been shown to render current equipment obsolete within five years of its introduction to the market. Suddenly, the prospect of possibly eating a million dollar expense every five years seems less palatable.
Benefits of Network Equipment Leasing
We at Direct Capital advise you to seriously consider the benefits of a network equipment financing agreement. Unlike other networking equipment finance companies, our focus isn’t simply on getting you money in order to secure new equipment; we also want you to be able to keep up with your competition by providing you with complete network refresh option at the end of your lease agreement. You can have this chance without having to tie up your company’s working capital or business credit lines, giving you the freedom to employ those resources towards other aspects of your business.
The decision to take advantage of one of our networking equipment leasing options is simply the first step in your journey to update your current hardware. Next comes the all-important decision of which type of lease agreement you want. While there are certain terms and conditions with all financing and leasing packages, the types of leases available generally fall into two categories: capital or operating.
A capital lease is essentially a purchasing agreement, with the monthly lease payments going towards the purchase of the equipment. At the end of the lease term, you’re given the option of a $1 buyout, or to purchase the equipment at fair market value (FMV). Which you choose will influence the amount due on your monthly installments.
With an operating lease agreement, you’re renting the equipment from the leasing company. You build no equity with the networking equipment leasing company, but you give yourself the flexibility to walk away from that provider or upgrade to their latest equipment once the lease term is over.
Whichever lease option you choose, there are tax implications to consider. The Section 179 Tax Provision allows companies to deduct lease payments of up to $500,000 for any new or used business networking equipment. Certain companies may even be tax-exempt on capital leases. Check with your accounting department to discuss what tax benefits you may see from your networking equipment finance agreement.
Ready to get Started?
The decision regarding what kind of lease you want to secure your networking equipment through is an important one, as is the choice of the financial provider that will back your network equipment leasing agreement. Let Direct Capital be that lending partner. Our experience in IT systems leasing makes us one of the top qualified network equipment leasing companies to help you with this process. Call us today at 1.866.777.0117 to find out more about our many network equipment financing options.