Equipment Financing Calculator

Build the equipment purchase budget

Start with the equipment price plus purchase-related charges you expect to finance, such as applicable sales tax, delivery, or installation. Use your actual supplier and lender quotes. The tool does not assume a national average price, tax rate, or equipment lending rate.

Enter your cash down payment and identify any loan fees separately. A financed fee raises the loan balance; an upfront fee raises closing cash. Keep each charge in only one category. If you include delivery in the purchase cost, do not add it again as a separate financed fee.

Use the annual note rate from the financing agreement. Enter the full number of regular monthly payments. This calculator assumes a fully amortizing loan with payments at month-end; a lease, seasonal-payment contract, or balloon agreement needs its own cash-flow schedule.

Use the same amount, rate, fee treatment and term when comparing offers. Bank of America's business-loan calculator likewise separates the loan amount, interest rate and term; its result is an illustration rather than an equipment quote or approval.

Continue with Equipment Lease vs Buy Calculator or SBA Loan Calculator for the next calculation.

How the payment is calculated

Starting principal equals the financed purchase budget minus the down payment, plus separately financed loan fees. The monthly payment is calculated from that principal, the note rate divided by 12, and the number of payments.

At the beginning of the loan, interest usually takes a larger share of the payment because the outstanding balance is larger. As principal falls, the interest amount falls under a fixed-rate schedule. At zero interest, each payment is simply principal divided by the payment count.

The results distinguish three totals: scheduled interest, financing cost including fees, and total purchase cash outlay including the down payment. That last amount helps compare a financed acquisition with the cash price. It still excludes ownership expenses you have not entered, such as maintenance, insurance, downtime, or resale proceeds.

Example: buying a $60,000 machine

Assume the quoted purchase budget is $60,000. Your business pays $10,000 down and finances a separate $1,000 loan fee. Starting principal is therefore $51,000.

At an illustrative 9% annual note rate over 60 months, the scheduled payment is $1,058.68. The unrounded schedule produces $12,520.57 in interest. Adding the financed fee gives $13,520.57 in financing cost. Including the $10,000 down payment, total cash paid for the purchase and financing is $73,520.57.

This example assumes no balloon, extra payments, additional upfront fees, or recurring financing charges. The figures are hypothetical. A lower payment obtained by extending the term can increase total interest and leave debt outstanding longer than the equipment remains productive.

Compare the loan with the equipment's useful life

Monthly affordability is only one part of the purchase decision. Estimate how the equipment will affect revenue, labor, output, maintenance, or outsourcing costs. Keep those operating assumptions separate from the financing result; a loan calculator cannot verify the equipment's promised productivity.

Check whether the loan ends before a major replacement or overhaul is likely. A long term can create cash-flow pressure if the equipment fails or becomes obsolete while principal remains. Also review the contract for collateral, guarantees, early-payoff rules, and charges that are absent from a headline rate.

For a broader loan comparison, use the business loan calculator. If customer invoice timing is creating the financing gap, the invoice factoring calculator can illustrate a different funding structure. Compare offers using the same amount of usable cash and the actual payment schedule.

What is outside this estimate

The tool does not calculate depreciation, Section 179 deductions, bonus depreciation, or a tax credit. Those depend on facts beyond a payment quote, including the asset, business use, placement in service, and applicable tax rules. It also does not estimate the equipment's resale value or guarantee approval.

A lease quote may include a purchase option, residual amount, advance rentals, or return charges. Do not enter a lease payment as a loan interest rate. Compare the full lease and purchase cash flows over the same ownership period when deciding between those options.

Compare lease and purchase cash flows

A fully amortizing equipment loan and a lease do not use the same cash-flow structure. After checking the purchase loan here, use the Equipment Lease vs Buy Calculator to compare entered lease payments, purchase cash flows, terminal value, and end-of-period obligations over one matching horizon.

Inputs, outputs and result meaning

Calculates payment, interest, total Cash, and principal from purchase Budget, down, financed Fees, and upfront Fees with visible method, validation, precision, sources, and limitations.

Inputs

Purchase Budget

Supported units include entered unit. The supported range is -1,000,000,000 through 1,000,000,000. This field is optional.

Down

Supported units include entered unit. The supported range is -1,000,000,000 through 1,000,000,000. This field is optional.

Financed Fees

Supported units include entered unit. The supported range is -1,000,000,000 through 1,000,000,000. This field is optional.

Upfront Fees

Supported units include entered unit. The supported range is -1,000,000,000 through 1,000,000,000. This field is optional.

Rate

Supported units include entered unit. The supported range is -1,000,000,000 through 1,000,000,000. This field is optional.

Months

Supported units include entered unit. The supported range is -1,000,000,000 through 1,000,000,000. This field is optional.

Outputs

Payment

This is the primary result. It is formatted as currency using the calculator’s selected or declared currency context. The visible result uses up to 2 decimal places according to the output rule.

Interest

It is formatted as currency using the calculator’s selected or declared currency context. The visible result uses up to 2 decimal places according to the output rule.

Total Cash

It is formatted as currency using the calculator’s selected or declared currency context. The visible result uses up to 2 decimal places according to the output rule.

Principal

It is formatted as currency using the calculator’s selected or declared currency context. The visible result uses up to 2 decimal places according to the output rule.

Financing Cost

It is formatted as currency using the calculator’s selected or declared currency context. The visible result uses up to 2 decimal places according to the output rule.

The calculator validates and normalizes the labeled inputs before applying the documented calculation model. Keep the result label, unit, selected mode, cited-source date and stated limitations with the answer.

Frequently asked questions