What are the pros and cons of utilizing deferred payments with an equipment loan?


The primary benefit of a deferred payment for a business is the capability to place the equipment in their facility and start generating income before dishing out any out-of-pocket payments. The downside is that the loan period is extended, and thus it will take longer to pay the asset off in the long run. The deferred option is best used if a business is looking to acquire equipment during a seasonal downtime and they are looking to hold off on making payments until their busy season arrives. It is also useful if the business is acquiring an asset they may not be familiar with and could use the extra time to learn how to use it before making monthly payments.  

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