http://battlefu.com/uploaded/solenoe-testo-ribki-kartinki.html соленое тесто рыбки картинки Equipment Financing
When most business owners think of equipment they do not think of a pizza oven or office furniture; but as far as business equipment is concerned, those things are considered to be equipment just like a construction implement or a large milling machine. Any tangible asset, apart from buildings and property, used for a business operation is considered as business equipment.
At a Glance
Equipment financing can be a fast and simple way to fund up to 100% of the value of the computers, machinery, vehicles, or whatever else you need to run your business.
Next Loan Type:
Maximum Loan Amount
Up to 100% of equipment value
Expected life of equipment
8 – 30%
As little as 2 days
http://www.fmgrace.org/disqus/kredit-na-bankovskuyu-kartu.html кредит на банковскую карту How does it work?
To put it very simply, leasing has certain similarities to taking out a loan. The only difference is that the lender buys all the equipment and leases it to you for a monthly fee. Most of the equipment leases have a fixed term and interest rate to make sure that the payment is the same every month. The rates can vary depending on your credit profile and the leasing company (it can lie anywhere between a high single digit to 30 percent or more). So make sure that you shop around before you are ready to commit. The lease term is predetermined and at the end of it, the business owner can purchase all the equipment at its market value or for a predetermined amount – sometimes it is as low as 1 dollar.
Leasing is attractive for business owners who need to buy equipment that gets outdated pretty soon, or if the equipment is expected to suffer a lot of rough handling over the course of its useful life. This allows business owners to update their equipment regularly at the end of their lease term.
What are its benefits?
Let us look at some of the most key benefits of equipment financing:
- Flexible financial solution – The types of financing solutions offered by equipment financing companies (leases, especially) are quite flexible and can be tailored to specific cash flow, accounting or tax needs.
- Capital preservation – Financing is better than spending cash, and the kind of financing you choose (loan vs. lease) can help mitigate most of the uncertainty of investing in a capital asset that might not increase the efficiency or yield the desired return, future sales or cost savings.
- Better expense planning – Maintaining a consistent budget and cash flow is another benefit of financing equipment. Instead of having to go through capital outlays that lead to huge and unwieldy budget fluctuations, financing enables expense planning.
- Flexible business cycle – Certain leases make allowances for seasonal business fluctuations, lower monthly payments when the project is just getting started and the equipment isn’t generating any revenue.
- Up to date technology – A lot of businesses cannot afford to buy the equipment that they need to be competitive and thrive. With the help of term financing, they can acquire better equipment that would have been out of their reach if they were considering buying it.
- Equipment expertise – Most of the equipment financing companies have a specialty in some equipment domain, which is something that other finance sources don’t have. Equipment financiers tend to have a special relationship with their distributors and manufacturers and specialize in certain industry categories or equipment types.
- Managed obsolescence – By leasing the finance for your acquisition, you avoid the risk of owning any obsolete equipment. Most of the agreements allow for fast and easy equipment updates. Most of the equipment financing companies work in partnership with the vendors and will closely work with you to make sure that you have the right equipment.
- More reliable asset management – Asset management is one of the biggest benefits of many kinds of equipment finance and it is a foolproof way of making sure that the equipment that is in operation is not over-utilized or under-utilized. With the help of a good asset management program, you can track the equipment throughout the life cycle right from the deliver to installation, maintenance, use, de-installation and disposition.
- Equipment disposal – Most of the small businesses do not have the knowledge or resources to efficiently manage and sell all their old equipment. You can easily outsource all the equipment management functions so that the financing company can handle the resale or disposal when it is time for you to retire the asset.
- Reduced risk – Equipment purchases comes with considerable risk to the owner, from capital outlays to equipment expertise, from obsolescence to asset management. Financing does away with a lot of the unnecessary risks, which allows you to spend all your attention on your business.
Things You Need to Consider Before You Take an Equipment Lease
If you are planning to finance your equipment through a loan or a lease, you need to have a thorough look at both the options and consider which of the two will balance your cash flow, usage and financial objectives better. Here’s a handy checklist of questions to help you decide:
- How long is the equipment going to be in use? – If you are planning to use the equipment for a short time (three years or less), then leasing is preferable. If the equipment is going to be in use for three years or more, then you can go for a loan or a lease depending on a number of other factors.
- What’s your monthly budget? – As is the case with any extant business expense, you need to factor in the monthly repayment cost and see how well it fits into the planned budget. With leasing, the monthly payments are much lower.
- Is the equipment going to lose functionality while it’s still in operation? – With leasing, you do not have to worry about owning obsolete equipment since the lessor assumes the risk. Some lease financing plans allow lessees to upgrade their technology or replace the equipment as per the terms in the contract.
- Does the equipment have a specific use or is it going to be used on a wide variety of projects? – More often than not, the objective behind buying or leasing new equipment is to use it to produce revenue. If the equipment you are planning to acquire is going to be used for just one project, then think twice before taking a loan as the equipment is going to remain inoperative while you are still making payments on the loan. It is better to put an end to the expense if your equipment stops generating income. A lease makes it much easier for you to do this.
- How much money do you need upfront for a loan or a lease? – Leasing often provides full financing of the equipment cost and the costs of transportation, delivery and installation, training and testing, as well as other deferred charges. Loans generally need a sizable down payment. They also do not include any other cost benefit. So, if you are thinking about going for a loan, find out how much down payment you are required to set down and see if you have the capital for it.
- Can the business make use of the depreciation or is it better if it expenses its lease payments? – This depends on the situation you find yourself in. The financing arrangement’s tax treatment plays a big role in making a choice between a loan and a lease. A loan has the advantage of both interest expense and depreciation tax benefits. On the other hand, the lessor stands to realize the tax benefit if you are going to go for a lease, which will reflect in much lower monthly payments for you. You also get to expense your payment. If your company can’t make use of the tax benefit, then it is better to go for a lease than for a loan since the depreciation can be traded with the lessor for a more profitable cash flow.
These are some of the key considerations that should go into the loan versus lease decision making process. Use our tool to see if you qualify for a loan.
Equipment Financing Advantages & Disadvantages
Lowest down payments
Quick access to cash
Equipment serves as collateral