Dealers tend to quote a lease because the monthly number is lower. Accountants tend to prefer a loan because of the deduction. The better question is what you want this machine to be in five years: something you own outright, or something you hand back.
The four ways to pay for a $55,000 skid steer
What the monthly numbers look like
A $55,000 compact track loader, average credit, no money down.
| Structure | Term | Monthly | At the end |
|---|---|---|---|
| Equipment loan | 60 mo | $1,249/mo | You own it, worth roughly $22,000 to $27,500 |
| $1 buyout lease | 60 mo | $1,211/mo | You own it for $1 |
| FMV lease | 48 mo | $1,164/mo | Return it, or buy at market (about $19,250) |
| Dealer captive at 0%, 48 mo | 48 mo | $1,146/mo | You own it, if you qualified and the price held |
Illustrative estimates at an average-credit rate, not offers or quotes. FMV lease figures assume a 35 percent residual; actual residuals are set by the lessor per machine. Run your own numbers in the payment calculator.
How to pick
- You run it 1,000-plus hours a year and keep machines until they die: loan or $1 buyout. The FMV lease's low payment comes with an hours cap, usually 800 to 1,000 a year, and an excess-hours charge on return. Heavy users blow through it.
- You want the newest machine every three years and do not want to sell the old one: FMV lease. You are paying for depreciation only, and the lessor handles the resale instead of you listing it and waiting months for a buyer.
- You have a big tax year and want the deduction now: loan or $1 buyout, because you have to be the owner to take Section 179. The full 2026 limit and 100 percent bonus depreciation apply to a financed machine placed in service by December 31. The Section 179 page has the math.
- The captive is offering zero percent: take it if you qualify, but get one outside quote first and negotiate the price as a cash buyer before you mention financing. Zero percent on a machine priced $4,000 high is not free.
- Credit is the issue: $1 buyout lease. Lease paper is often easier to get approved on a story file than a loan on the same machine, because the lessor holds title.
The clause people miss
On an FMV lease, read the end-of-term section before you sign. Two things bite: the return condition standard, which can mean a bill for tire wear and bucket damage that is normal on a skid steer, and the automatic renewal, which keeps billing you month to month if you miss the notice window, usually 60 to 90 days before the end. Set a calendar reminder the day you sign. The skid steer page covers what we finance and typical terms.
Land Tech Capital is a commercial equipment finance broker, not a lender. Lenders make their own credit decisions and set their own terms. Nothing here is an offer of credit or tax advice.
Questions we get
Is a lease cheaper than a loan on a skid steer?
An FMV lease has a lower monthly payment because you only pay for the depreciation. Over the life of the machine a loan is usually cheaper, because you own something at the end. A $1 buyout lease costs about the same as a loan.
Can I take Section 179 on a leased skid steer?
On a $1 buyout lease, yes, because you are treated as the owner. On a fair market value lease, no. The payments are a deductible operating expense instead. Confirm with your accountant for your situation.
Can I finance attachments with the skid steer?
Yes. Buckets, grapples, augers, mulchers, and forks bought with the machine can go on the same contract, and standalone attachment financing exists for larger items like a forestry mulcher.
Is there a down payment on a skid steer lease?
Often first and last payment in advance, which is roughly 3 to 5 percent, rather than a percentage down. Start-ups and challenged credit may see 10 to 15 percent on lease paper too.
