How does IT hardware financing work?
Servers, laptops and switches usually get replaced every three to five years, and that shapes how they should be financed. Here’s how the structures work, what installation and software do to the deal, and what the payments look like.
On this page
U.S. businesses put $280.2 billion into computers and peripheral equipment in 2025, up about 56% from $179.8 billion in 2024 (Bureau of Economic Analysis, via FRED). That total includes the servers going into the big AI data centers. In its 2026 U.S. Economic Outlook, the Equipment Leasing & Finance Foundation projected that equipment and software investment would grow 6.2% this year after inflation, with technology equipment and software making up most of the recent growth.
The gear is aging faster, too. Amazon cut the estimated useful life of some of its servers and networking equipment from six years to five starting in 2025, citing how fast AI and machine learning are moving (Amazon 2025 Form 10-K). If one of the largest server buyers anywhere now plans on five years for some of its servers, a 30-person office shouldn’t plan on running a server for ten years. That short life is why IT financing works differently from financing a truck.
What IT hardware can you finance?
Almost everything in the server closet and on the desks, plus the work to put it in: servers and storage, switches, firewalls, laptop and desktop fleets, phone and VoIP systems, POS systems, data center buildouts, and conference room AV. New and used both qualify. Deals run from a usual minimum of about $15,000 to $5 million and up; the full list is on our IT hardware financing page.
Some common pieces, at listed prices:
| Equipment | Listed asking price | What moves the price |
|---|---|---|
| 2U rack server, new and configured | About $16,000 to $22,800+ each | Processors, memory and drives |
| 2U rack server, refurbished prior generation | About $1,300 to $3,000 each | Memory and included drives |
| Business laptop | About $1,200 to $1,900 each for common configurations | Processor, memory and storage |
| Small or mid-size office firewall | About $900 to $3,700 with a year of security services | Model size; the security subscription renews yearly |
| 48-port PoE network switch | About $6,200 to $13,500 each | Model line and software license level |
| Video conference room kit (Teams Rooms) | About $7,200 to $9,200 per room | Hardware only; mounting, installation and licenses are extra |
Listed asking prices at online resellers and manufacturers, checked October 9, 2026, not appraisals or offers. Your reseller’s quote will differ.
One firewall won’t reach the $15,000 usual minimum, but a refresh usually will: twenty laptops at about $1,500 each is $30,000 before anyone orders a docking station. Windows 10 is one reason to do it now. Microsoft ended support on October 14, 2025, so those PCs still run but stop getting security updates unless the business pays for Microsoft’s Extended Security Updates (Microsoft).
Should you lease or finance IT equipment?
Lease most of it, and finance the parts that last. IT hardware leasing fits servers, laptops and network gear because they’re replaced every three to five years and aren’t worth much by then. An FMV lease gives you a lower payment and an upgrade path, and the old fleet goes back when the term ends.
| FMV lease | $1 buyout lease | Equipment finance agreement | |
|---|---|---|---|
| Who owns it during the term | The funder | The funder holds title until you pay the $1 | You, from day one |
| Payment on $75,000 over 48 months | About $1,606 | About $1,866 | About $1,866 |
| End of the term | Return it under the lease’s return terms, upgrade, or buy it at market value | Pay $1 and keep it | Nothing left to pay |
| Terms at Five West | 24 to 60 months | 24 to 60 months | 24 to 84 months |
| Section 179 | Generally no. You deduct the payments as rent. | Generally yes | Generally yes |
| Fits IT gear like | Servers, laptops, switches and firewalls on a refresh cycle | Gear you’ll keep after the term | Racks, cabling, phone systems and buildouts |
Payments at an assumed 9%, in arrears, with no money down. The FMV figure assumes a 20% residual, as in our lease vs. loan guide. Residuals on IT gear vary by funder and equipment, and a lower residual means a higher FMV payment. Illustrative, not an offer.
A $1 buyout lease and an EFA both end with you owning the gear. If you’re not sure which one a quote describes, our $1 buyout vs. FMV vs. EFA guide shows how to tell.
Before you sign an FMV lease, check the notice window for returns and ask how drives on returned laptops and servers get handled.
If it were my office, I’d lease the laptops, servers and switches and finance the racks, cabling and phones.
How does hardware-as-a-service financing work?
Hardware as a service (HaaS) usually means one monthly price per device or per user that covers the equipment, the support, and replacement on a schedule. You can build close to the same thing with an FMV lease that has the services bundled in and a refresh at the end.
If you hire mid-term, qualifying leases have add-on and upgrade paths for the new seats. At the end, the old fleet goes back and you start over on current gear. For a per-seat number, divide the payment by the devices: the $30,000 laptop refresh works out to about $48 per laptop a month over 36 months on an EFA, and less on an FMV lease.
We finance the equipment and the services; your MSP or reseller supplies them. If a provider already sells you HaaS, ask who owns the equipment and what happens to it, and to your payment, when the term ends.
Can software, installation and services go on the same agreement as the hardware?
Yes, on qualifying transactions. Installation, configuration, licenses and support agreements can be included, so you get one payment for the project instead of a hardware invoice plus a stack of services bills.
How much of the deal can be services? There isn’t one number. These are soft costs, with nothing physical behind them, and programs commonly cap them as a share of the hardware, each with its own limit. So I won’t quote you a percentage. A project that’s mostly hardware, with installation and a year of support on top, is the easiest kind to place. If it’s mostly software and implementation, like an ERP rollout with a couple of servers attached, look at our software financing, which finances 100% of the project, soft costs included.
Either way, ask your reseller to itemize the quote. Firewalls show why: a FortiGate bundle sold under one part number includes a year of security subscriptions, which renew yearly and count as a soft cost.
What does server and computer hardware financing cost per month?
At an assumed 9%, a $50,000 server, storage and switch refresh comes to about $1,244 a month over 48 months. Other common projects:
| Example project | Amount | Monthly payment |
|---|---|---|
| 20-laptop refresh at about $1,500 each | $30,000 | About $954 over 36 months, or $747 over 48 |
| Servers, storage and core switches | $50,000 | About $1,590 over 36 months, or $1,244 over 48 |
| VoIP phone system, racks and cabling for a new office | $75,000 | About $1,866 over 48 months, or $1,557 over 60 |
| Office buildout: firewalls, switches, two Teams rooms and installation | $120,000 | About $2,491 over 60 months |
| Full deployment: servers, network, laptop fleet and installation | $150,000 | About $4,770 over 36 months, or $3,114 over 60 |
Example project sizes, not quotes. EFA or $1 buyout payments at an assumed 9%, in arrears, with no money down. Illustrative, not an offer.
Server financing and laptop financing don’t need the same term; match each one to how long you’ll actually keep that gear. Terms run 24 to 84 months on an EFA and 24 to 60 on a lease, but since most of this gear refreshes every three to five years, I’d keep the term inside that window. Otherwise you’re still paying for laptops after they’re gone. Racks and cabling can carry longer terms.
What do you need to qualify for IT equipment financing?
Many programs for established businesses start around a 600 FICO, and two or more years in business opens the most programs and the best pricing. One to two years narrows the field but is still workable. Under a year, you’re underwritten as a startup, which typically means 700+ personal credit, industry experience, and working capital left after the purchase.
IT has one quirk. Hardware loses value fast, so underwriting leans on the business more than it would for a truck or a machine, and time in business and clean cash flow count for more. The score alone rarely decides it; our credit score guide has the rest.
Paperwork is light. On qualifying files up to $500,000 it’s application-only, with no tax returns or financial statements, and it starts with a soft credit inquiry. First responses usually come within 1 to 2 business hours, clean application-only files can be approved in as little as 30 minutes, and funding can follow 24 to 48 hours after signing.
Does Section 179 cover servers, computers and software in 2026?
Usually, yes. The 2026 limit is $2,560,000, phasing out once you put more than $4,090,000 of qualifying property in service (IRS Rev. Proc. 2025-32). Computers and peripheral equipment are 5-year property, and off-the-shelf software (sold to the public on a nonexclusive license and not substantially modified) qualifies too (IRS Publication 946). One exception: subscription or cloud software is usually deducted as you pay it instead.
The structure matters more than the gear. On an EFA or a $1 buyout lease with nothing down, the equipment is deducted the same as a cash purchase if it’s placed in service by December 31, and bonus depreciation is 100%. On an FMV lease the funder owns the equipment, so you deduct the payments as rent.
Placed in service means installed and ready to use, so a server still in its box on December 31 doesn’t count. Our Section 179 year-end playbook has the timeline, and the Section 179 calculator runs the estimate. Confirm the treatment with your tax advisor.
What should you send to get IT financing quoted?
Your reseller’s or MSP’s quote, with the hardware and services itemized. That’s usually all a first response needs. A few things speed it up:
- The quote, broken out. Hardware on its own lines, then licenses, installation, configuration and support.
- Keep it or hand it back? That points to an FMV lease, or to a $1 buyout or EFA.
- The install date. It matters most in the fourth quarter if you’re counting on Section 179.
- A short application. Up to $500,000 on qualifying files, that’s the whole package. Above that, add financials.
On the other side of that quote? Resellers, MSPs and integrators can put monthly payments on their proposals through our vendor program at no cost, and they’re paid 100% of the invoice when the deal funds.
Frequently asked questions
Can you lease IT equipment instead of buying it?
Yes, and IT is leased more often than most equipment. Servers, laptops and network equipment are usually replaced every three to five years, so a fair market value lease gives you a lower payment, an upgrade path, and the option to return the old equipment at the end of the term. Leases run 24 to 60 months.
Is hardware as a service financing the same as leasing?
It’s close. Hardware as a service usually bundles the equipment, support and scheduled replacement into one monthly price per device. A fair market value lease with installation, licenses and support included, and a refresh at the end of the term, works much the same way. Five West finances the equipment and services; your MSP or reseller supplies them.
Can installation and software be financed with IT hardware?
Yes, on qualifying transactions. Installation, configuration, licenses and support agreements can go on the same agreement as the hardware, so the project is one monthly payment. Ask your reseller to itemize the quote, because programs differ on how much of a deal can be soft costs.
How long can you finance servers and computers?
Equipment finance agreements run 24 to 84 months and leases run 24 to 60 months. Since most IT hardware is replaced every three to five years, it usually makes sense to keep the term inside that refresh cycle.
What credit score do you need for IT equipment financing?
Many programs for established businesses start around a 600 FICO, and two or more years in business opens the most options. A business under a year old is underwritten as a startup, which typically means 700+ personal credit, industry experience, and working capital left after the purchase. Because IT hardware loses value fast, cash flow and time in business carry extra weight.
Can you finance used or refurbished servers?
Yes. New and used IT equipment can both be financed. Refurbished prior-generation servers list for much less than new ones, so a refurbished server usually needs switches, storage or other gear added to reach the $15,000 usual minimum.
Do computers and servers qualify for Section 179?
Usually, yes, and so does off-the-shelf software. The 2026 limit is $2,560,000. Equipment on an equipment finance agreement or a $1 buyout lease is deducted the same as a cash purchase if it’s placed in service by December 31. On a fair market value lease, you deduct the payments as rent instead. Confirm the details with your tax advisor.
Price your IT project.
Put in the project cost, term and structure and see an estimated payment in the Quote Builder. When it fits, one short application gets you matched with a funding professional. No credit pull to start, no obligation.
This article is general information about IT hardware financing. It is not tax, legal, or accounting advice, or a commitment to finance. Tax and accounting treatment depends on your contract and your business; confirm with your CPA. All financing is subject to credit approval and underwriting.