Construction Equipment – When to Rent vs. When to Buy
Construction Equipment Funding – When to Rent vs. When to Buy
Should general contractors / subcontractors rent or buy the tools they need for their construction projects? Conventional wisdom might lead you to believe that buying is a better strategy than leasing, but there are many factors at play. Monthly payments may be two to four times more with renting, but these costs can be offset by increased flexibility. Rental construction equipment also has lower maintenance and transportation costs.
The decision is not always straightforward. You either buy or rent the equipment, but one doesn’t necessarily better than the other. Before making a decision, examine the total costs associated with ownership as well as the benefits and weigh these against the pros and cons of renting. The benefits for apprentices are that they can preserve capital and broaden their scope of operation during difficult times.
Construction equipment is expensive and purchasing it outright could cause a major strain on cash flow. Therefore, financing equipment is a great way to go. When financing equipment, loans are typically amortized and each month a portion of interest and principal is paid back. Once the loan is fully paid off, any liens on the equipment are removed. Equipment leasing is another option if you prefer to lease as opposed to own. You may be more inclined to lease if new models of equipment are frequently released, you do not want to put a lot of money down on a purchase, you are looking for lower monthly payments, or if you need consistent upgrades on the equipment.
How Can fincentiv™ Help?
fincentiv™ is the first platform to use a proprietary matching system to match the financing needs of contractors with a spectrum of different lenders and lending options. fincentiv™’s matching using its lendcentiv™ model to connect borrowers to lenders. Our platform does the work for you by narrowing the field from thousands of lenders to match you with a select group of funding opportunities. You simply create an account, fill out your company profile, and upload the necessary loan application documentation; we take care of sourcing the lenders for you!