financing equipment. is it wrong?

Discussion in 'Lawn Mowing' started by jarroo's lawncare, Aug 31, 2006.

  1. Howie's Lawn Care

    Howie's Lawn Care LawnSite Senior Member
    Posts: 512

    I never thought about doing it that way. Couldn't you get a 12 month no interest, realize you couldn't pay it, and then just refinance at the bank? I think any handheld equipment or ZTRs should pay for themselves in one to two seasons of use. I don't know about vehicles though. I guess alot of people use their personal vehicles.
  2. tacoma200

    tacoma200 LawnSite Fanatic
    Posts: 5,426

    I only work at this part time and I have no problems paying the equipment off. I am very disciplined and don't skim the profits right now. I owe on the house and mowers, thats it. But I drive a 92 GMC (in great shape) not a 2006 dually diesel. But taking months shopping comparing prices on such things as mowers has saved me thousands of dollars. I have objects I can use a collateral in case of an emergency also. The bass boat will go before the mowers.
  3. JTF40

    JTF40 LawnSite Senior Member
    Posts: 875

    Other than your home/property, there is NEVER an excuse for financing anything - even autos, lawn equipment, vacations, etc. Yes, I have financed tens-of-thousands of dollars of "stuff" over my lifetime. However, other than my mortgage, I owe nobody nothing. It took many 70 hr. workweeks to get out of consumer debt but now, I can sleep at night - 20 years ago I couldn't.

    In summary, try to save to buy what you want. Remember the 22nd. chapter of Proverbs - "The borrower is slave to the lender."

    "Debt is dumb, cash is king, and the paid-off home mortgage HAS taken the place of the "BMW" as the status symbol of choice." Dave Ramsey
  4. tacoma200

    tacoma200 LawnSite Fanatic
    Posts: 5,426

    I know where your coming from but how would the average business get started without a loan. Say you wanted to open a restaurant, convenience store, small company of any kind, etc. Most large company's and successful people (those that didn't inherit it) had to have financial backers or borrow money. I'm sure Bill Gates had some help getting out of his garage workshop. Even for a college education, which is an investment means borrowing money for alot of people. I respect you opinion ,mine is just a little different.
  5. Dashunde

    Dashunde LawnSite Senior Member
    Posts: 628

    The simple answer... It's totally fine if your interest rate is low.

    And it's totally great if you can get one of those 0% loans if its fully paid off in 6 months (or whatever they say), and your able to make that work.
    Be weary of the not-fully-paid-off in time rate though, it might jump from 0% to 23% or worse.
  6. lawnman_scott

    lawnman_scott LawnSite Fanatic
    Posts: 7,547

    I think I paid about $8,200 for my exmark, and got a whopping $600 trade in on my great dane (a fair price), and my payment is about $250 a month. I dont need a whole lot of work to pay that do I? If you have the money laying around, pay it, otherwise a small payment on something that can make you alot of money consistantly is a good deal.
  7. ACutAbovesiny

    ACutAbovesiny LawnSite Senior Member
    Posts: 590

    Don't get carried away and you'll be fine. I finance alotof my equipment but make sure that I have the business lined up to afford all my payments. Just don't get in the habit of saying "I have the credit for it...CHARGE IT"
  8. ACutAbovesiny

    ACutAbovesiny LawnSite Senior Member
    Posts: 590

    My dream and I'm sure the dream of others is to get a job that requires you to buy a peice of equipment and profit enough from that one job to pay it off at the end of the year. This way any other jobs that require the use of that equipment would be all profit.

    HOOLIE LawnSite Gold Member
    Posts: 3,981

    If you actually have a lot of cash on can make more money by investing it than you would pay in interest on an average loan...really not fiscally smart to keep large amounts of cash in low-interest savings so you can "pay for it all by yourself" when you want a ZTR or truck...
  10. Evergreenpros

    Evergreenpros LawnSite Bronze Member
    Posts: 1,155

    Dumb to use your cash when they offer to use their cash for nothing (0%).

    As far as money management there is a simple rule: Always use the cheapest money.

    Even if you keep that 8k in a 1.5% savings account you would be better off taking the 0% financing. If you insist on keeping your money in a mattress, use your money since it looses 3-5% per year.

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