Jon Lynch Financial

Equipment Sale-Leaseback Calculator

Pull cash out of equipment you already own — and keep using it. See your closing proceeds, monthly lease payment, total lease cost, and the residual buyback at the end of the term.

Your equipment

Your numbers

Cash at closing
— of FMV, net of fees
Monthly lease payment
amortized to residual
Total lease cost
all payments over term
Residual / buyback
to keep the equipment
All-in cost of capital
payments + residual − closing cash
Effective annual rate
approximate

Sale-leaseback is a financing transaction. You transfer title to the lessor at closing in exchange for cash and a lease back. Lease payments are typically deductible as operating expense (consult your CPA — ASC 842 / IRS treatment depends on lease type). Residual buyback is usually structured as a $1, 10%, or FMV purchase option — confirm which one in the agreement.

When this makes sense — and when it doesn't

When it makes sense

  • You own hard, titled assets — heavy equipment, trucks, manufacturing machines, medical equipment, IT hardware — and you need liquidity now.
  • The equipment has 3+ years of useful life left at current valuations (lenders need recoverable collateral).
  • You'd rather take a known monthly payment than dilute equity or sign a higher-cost merchant cash advance.
  • You want to preserve your bank line of credit for operations, payroll, or growth.

When it doesn't

  • The equipment is highly specialized, near end-of-life, or in a depreciating tech category (last-gen servers, obsolete CNC machines) — lenders pay too little to make sense.
  • You'd be the only operator of the equipment and the lease puts use/transfer restrictions you can't live with.
  • Your business cash flow already can't support adding a fixed monthly payment.
  • Lower-cost options exist — SBA 7(a), bank term loan, or a HELOC backed by personal real estate are often 200–500 bps cheaper.

Typical pricing. Sale-leaseback rates land between traditional equipment financing (6–9%) and an MCA equivalent APR (40%+). Expect 8–14% all-in, depending on industry, equipment type, and your time in business. Trucking, construction, and medical equipment usually see the tightest pricing.

Which path fits you?

This tool helps three audiences. Pick the one that's you.

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