Business Equipment Loans and Leases in Lewiston, Idaho: What Each One Costs by the Last Payment

In a lease, a leasing company buys the equipment and the business pays to use it for a set number of months. For a child care center replacing its commercial linen washer and dryer and its sanitizing dishwasher, the leasing company stays the owner during the term, and the center makes the monthly payment whether or not every room is full.

Three parts of a lease decide what it costs. The payment and the number of months set most of the total. The end-of-term option decides what happens next: return the items, renew, or buy them at a stated price or at fair market value. The early-termination clause says what is owed if the center wants out before the end, which can be most of the remaining payments.

A used machine costs less up front, but its remaining working life is shorter and harder to judge. A funding partner reviewing a used purchase may ask for the hour-meter reading, the year and serial number, service records, photos and the seller details. A dealer sale and a private sale can be reviewed differently.

Illustration only, invented figures: a landscaping crew finds a used mini excavator with 2,600 hours for $34,000. At an annual rate of 11.75%, 36 months costs $1,125.23 a month and $6,508.28 in interest; 60 months lowers the payment to $752.02 but raises the interest to $11,121.20. If the crew expects about four more working years from the machine, the 60-month term would still be running after that point.

Of the 26 landscaping services employer establishments County Business Patterns recorded in Nez Perce County, ID for 2023 (NAICS 561730), 84.6% employed under five people.

Both leave the restaurant owning the range and fryer line from day one, with the finance company holding a security interest until the last payment. The difference is in how the deal is written. A loan states an interest rate and a balance that can be paid off early. An equipment finance agreement (EFA) can be written as a fixed set of payments, sometimes with no rate shown, and an early payoff may still owe most of the remaining payments.

Illustration only, invented figures: the cooking line costs $27,500. Borrowed at an annual rate of 10.25% for 60 months, the line takes $587.68 a month and $35,260.80 by the final payment. An EFA quoted as 60 payments of $590.00 totals $35,400.00, which is $139.20 more. The two totals are close; the prepayment terms and fees in each document can matter more than that difference.

Food service is a sizable group here: County Business Patterns counted 98 food services and drinking places employer establishments in Nez Perce County, ID for 2023 (NAICS 722).

A $1 buyout lease is a lease in name, but the business is expected to keep the equipment: after the last payment, it buys the item for one dollar. The payments are set to cover the full price plus the leasing company return, so the total behaves much like a loan.

Illustration only, invented figures: a landscaper leases a sod cutter and attachments priced at $9,800 for 36 months. A payment of $330.18 plus the $1 buyout comes to $11,887.48, or $2,087.48 above the cash price. That difference is the cost of paying over three years, and it is the number to set against a loan quote for the same machine.

In a fair market value (FMV) lease, the payments cover only part of the price, because the leasing company expects the equipment to keep some value at the end. The office then chooses: return it, renew, or buy it at what it is worth then. The payment is lower than on a $1 buyout lease, but the buyout price is not known on the day the lease is signed.

That trade suits imaging and diagnostic equipment that newer models replace, such as a retinal camera in an optometry office. If the office plans to trade up at the end, returning the camera after a lower payment can cost less than owning it. If it plans to keep the camera, the buyout gets added to the payments, and the total can end up above any of the other routes.

Illustration only, invented figures: the same $30,000 retinal camera package over 48 months, four ways. The FMV buyout of $6,500 is an assumed value at the end of the term.

In this example, returning the camera under the FMV lease has the smallest total, $33,216.48, but the office has no camera at the end. Buying it out raises the FMV total to $39,716.48, the highest of the five rows. Of the three routes with a known cost of ownership (loan, finance agreement and $1 buyout lease), the loan costs least in this example; real offers can rank differently, so total each one the same way, as the lift, mower and trailer posts do.

Equipment financing follows a set order:

1. Get a written quote from the dealer or seller, with the model and serial number if it is used.
2. Send the request form or call (208) 361-6012, and talk through the machine and its quote with Keelmead Lending.
3. A partner reviews the business, the machine and any trade-in, and may check credit.
4. Any offer states the payment, the term, any down payment and the end-of-term terms.
5. Once the documents are signed, the partner pays the dealer or seller, and the range, lift or mower can be delivered.
6. At payoff, ask the partner to release its lien or security interest.

Enter the equipment price, any down payment, the annual rate and the number of months in the calculator on this page; it returns a monthly payment estimate, the interest over the term and the full cost with the down payment added. It works out loan-style payments only; for a lease, add the payments and the buyout by hand as in the table above.

Repair shops are one trade where equipment is the work itself: auto repair and maintenance employers in Nez Perce County, ID paid $7.4 million in wages in 2023 (County Business Patterns, NAICS 8111). For a cost that is not a machine, see the other business financing options.