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Equipment Leasing - Sale-Leasebacks
Secrets of Equipment Leasing: Secrets 1-6
Author: Milton FranklinEquipment leasing is intelligent decision making, especially when compared to bank loan financing or cash purchases. Investing cash reserves in equipment makes the business enterprise asset rich and cash poor. When a business is cash poor, it is severely limited in its ability to take advantage of new opportunities or to adequately respond to changing market conditions.
Today, more than 80% of all U.S. corporations lease some or all of their equipment. It is the use of equipment, not ownership of equipment that generates profits. This simple precept explains the rise of equipment leasing activity, especially as equipment life cycles shorten in this high-tech age. Whether opening a new business, expanding existing facilities or opening an additional location, the method you choose to acquire equipment can have a profound impact on your business, credit and cash flow.
Secret #1:
Virtually all types of equipment in almost any industry can be leased. Leases are specific. You can choose the manufacturer, the model number, the source and even accesories. You're covered by all conventional manufacturers' warranties. And because lease payments are usually lower than other forms of financing, your leasing dollar allows you to acquire more of the equipment your business needs or more advanced equipment. With an equipment lease, you get 100% financing so the amount of cash needed up-front is reduced. Most soft costs can be included: delivery charges, installation, training, and software to ensure that the equipment is productive immediately, speeding your return on investment.
Secret #2:
Bank loans can be dramatically more expensive than anticipated because of the large security deposit that is required. Down payments for bank loans will usually range between 20% and 40%. The result is that there is a tremendous difference between the effective APR and the stated APR. A stated 8% bank rate with a 25% down payment is actually equal to a 21% APR on a five year loan.
Secret #3
Even if you have the cash to purchase your equipment, purchasing is rarely, if ever, the best choice. With equipment leasing, cash can be used for other business requirements such as expanding sales, starting new marketing programs, offering quantity discounts, replenishing inventories, opening a new line of business, or increasing cash reserves. Using cash for necessary business expenses that cannot be financed is much more intelligent decision-making than spending it on equipment that is worth less and less as time goes by. Not only are there higher payments for traditional financing, but you'll have to come up with the entire amount for a cash purchase or a substantial down payment with a bank loan if you decide not to lease.
Secret #4
With the lower, fixed-rate payments of an equipment lease, you're protected against inflation. Cash outlays are deferred, as compared to an up-front purchase. In the future, "cheaper" dollars will be making your lease payments as inflation lessens your cost. You will be making your monthly payments to the leasing company with ever-inflating dollars during the term of the lease. This actually reduces the cost of financing to you in real dollars, a tremendous advantage that is often overlooked.
Secret #5:
Leasing equipment offers a wide range of benefits, from consistency with expenses to increased cash flow. But perhaps the most significant advantage of leasing is the ability to maintain up-to-date equipment. Leasing allows you to easily and affordably add equipment or upgrade to a completely new piece of machinery to meet future needs. This lets you transfer the risk of being caught with obsolete equipment to the leasing company.
Secret #6:
With the scheduled updating of your business equipment offered through equipment leasing, you can maintain a competitive edge, keeping you ahead of your competition. With an equipment lease, upgrading to newer technology during or after the lease is easy. In contrast, when equipment is purchased with cash or bank financing, there is an incentive to postpone any upgrade until the original investment has been recouped through depreciation, which hinders your flexibility. A planned replacement program avoids obsolescence and keeps you up to date with the latest state-of-the-art technology. An additional, often-overlooked disadvantage of ownership is equipment disposition. Ownership of equipment, the result of the full repayment of bank loans or cash purchases, includes several additional costs that are significant and can be avoided with leasing. These costs are associated with removal, environmental fees for disposal (for certain equipment categories, such as computers) and the costs of remarketing.
In summary, there are many "Secrets of Equipment Leasing" that require significant research to uncover. These "Secrets" can be determining factors in the survival and profitability of any business enterprise. As such, they warrant in-depth consideration to determine their potential contributions to every individual equipment acquisition situation. Nearly 100% of the time, bank loans and cash purchases are always significantly less beneficial and less advantageous than equipment leasing.
Article Source: http://www.articlesbase.com/finance-articles/secrets-of-equipment-leasing-secrets-16-424304.html
About the AuthorMilton Franklin, is a Founder of Nationwide Equipment Leasing LLC, an equipment leasing company that also offers Unsecured Business Lines of Credit. His company provides solutions to the current economic and financial crisis in the United States He can be reached at 800-395-4908. Go to http://www.neleasing.com/application-form.cfm and request Leasing Information to receive a free copy of his eBook, "Secrets of Equipment Leasing".
Capitalizing on Equipment Leasing for Your Business
By David Springer
If your capital budget is tight, but you need equipment to establish, maintain or grow your business, don't worry. Do what most other companies do: Take advantage of equipment leasing.
Equipment leasing is a viable and very popular option for companies large and small. In fact, 80 percent of all businesses in the United States lease all or part of their equipment, according to the Equipment Leasing Association (ELA).
That's not surprising, given the broad benefits of equipment leasing. This creative financing option offers business owners the best of both worlds: It allows you to pay only for the value of the equipment that you use during the lease term, rather than purchasing the equipment outright.
More specifically, the company selling the equipment simply makes a direct referral to a leasing company. The lease financing company buys and owns the equipment and then "rents" it to you for a fixed monthly fee over a set period. Leases can range anywhere from $2,000 to $2 million, with terms running 12 to 60 months.
Equipment leasing-which is suitable for any business at any stage of development-can be used to finance all types of equipment. Leases typically involve items such as office equipment, computers, and trucks and vehicles. But equipment leasing can also be used to finance software, hardware, consulting, maintenance, freight, and installation and training costs.
Benefits of Equipment Leasing
Equipment leasing gives you the ability to have the latest equipment for business, plus transfer the risk of technological obsolescence to another company. Leasing offers flexible terms and customized options that take into account your needs regarding cash flow, budget, transaction structure and seasonal fluctuations. And there's generally no down payment or collateral required with equipment leasing.
By leasing instead of buying equipment, you can leave money in the bank that can be devoted for other expenses. Since lease payments are usually smaller than regular loan payments, you don't have to pay out as much each month. You don't make use of your bank loans or lines of credit to lease equipment, and in general, a lease obligation is not carried on the balance sheet of your company. Also, the payments for leasing business equipment are generally tax-deductible.
Additionally, an equipment lease is generally more easily obtained than traditional bank financing. An application for a small-ticket lease of less than $100,000 is generally no more complicated than a credit card application. However, leases for more than $250,000 require detailed financial information from the business and a more thorough credit analysis.
Common Types of Equipment Lease Agreement
Lease agreement terms vary according to the financing company. However, the lease structure is generally affected by your credit rating, transaction size, asset type, industry and location. The key to getting the most suitable type of lease is to match the agreement to your equipment needs, cash flow requirements and overall business goals.
When considering a lease agreement, here are some important points to keep in mind. Most lease agreements require you to be responsible for the equipment for only as long as it is in your use or possession. In many leases, you're responsible for the burden of maintenance, interest, taxes and insurance. When the lease ends, you can opt to purchase the equipment for its fair market value (or a fixed or predetermined amount), continue leasing it, return it or lease new equipment.
Operating and finance leases are two of the most common types of lease agreements. With an operating lease-also known as a "true" or "fair market" lease-the goal is not to pay for the equipment. This type of lease is particularly attractive to companies that continually update or replace equipment and want to use equipment without ownership, but also want to return equipment at lease-end and avoid technological obsolescence.
An operating lease usually results in the lowest payment of any financing alternative and is an excellent strategy for bypassing capital budgeting restraints. It typically qualifies for off-balance sheet treatment and can result in improved return on asset due to a lower asset base. And it can also result in higher reported earnings in the early years of the lease.
The finance or capital lease is ideal for companies that want to own their equipment once the lease agreement ends, but prefer to use the benefits of leasing to acquire equipment. A finance lease is a non-cancellable, full-payout, agreement, in which the lessee is responsible for maintenance, taxes and insurance. This kind of agreement is most appealing when the lessee wants the tax benefits of ownership or expects the equipment's residual value to be high. The lessee purchases the equipment upon lease termination at a pre-set amount. The term of a finance lease tends to be longer, nearly covering the useful life of the equipment.
10 Questions to Ask Before Signing an Equipment Lease Agreement
When considering an equipment leasing contract, make sure you do your homework to negotiate the best terms for your business. The ELA recommends asking the following 10 questions before signing any lease agreement.
1. How am I planning to use this equipment?
2. Does the leasing representative understand my business and how this transaction helps me to do business?
3. What is the total lease payment and are there any other costs that I could incur before the lease ends?
4. What happens if I want to change this lease or end the lease early?
5. How am I responsible if the equipment is damaged or destroyed?
6. What are my obligations for the equipment (such as insurance, taxes and maintenance) during the lease?
7. Can I upgrade the equipment or add equipment under this lease?
8. What are my options at the end of the lease?
9. What are the procedures I must follow if I choose to return the equipment?
10. Are there any extra costs at the end of the lease?
Capitalizing on equipment leasing can help your business maximize resources while minimizing costs and risks.
Sovereign Funding Group is an experienced, reputable company that offers convenient, no-risk services to help you with the selling of your deferred payments and business financing, including equipment leasing [http://www.sovereignfunding.com].
Article Source: https://EzineArticles.com/expert/David_Springer/19244
http://EzineArticles.com/?Capitalizing-on-Equipment-Leasing-for-Your-Business&id=170516
Equipment Leasing Blunders That Can Cost Your Firm a Mint
By George Parker
Rod McHenry, the financial vice president of a document imaging company, thought he had great cause for celebrating. He had signed an unbelievable $370,000 lease proposal covering computer servers, workstations, software and other networking equipment. McHenry believed he had snared an incredible lease rate, capping off weeks of negotiating an acceptable equipment price with the equipment vendor. The proposal guaranteed a lease closing and offered a return of the 2% 'commitment fee' paid by McHenry's company if the leasing company failed to give credit approval within two weeks. Little did McHenry know that signing this proposal would lead his company into the 'Twilight Zone' of equipment leasing. Ultimately, his firm would fork out more than $15,000 in legal fees seeking lessor performance, only to learn that the lessor was already insolvent and mired in several similar lawsuits.
Like McHenry's employer, thousands of U.S. companies lease equipment each year, many of them without careful attention to potential blunders. Rod McHenry became victim to one possible pitfall, but there are several areas deserving careful attention.
Falling For the Lowest Rate
One potential pot-hole facing many would-be lessees is basing their lease decision solely on the lowest monthly payment. Even on the face of it, making a decision based on the monthly payment makes little sense. First, these amounts give only a partial picture of total lease pricing. An accurate discounting of cash flows using a present value analysis, including up-front lease payments, monthly payments, security deposits and fees can often change the outcome of the lowest lease bid. Making sure that each lease proposal is reduced to a present value calculation guarantees that you will be comparing apples to apples. Even if you make accurate price comparisons, pricing all by itself fails to consider several important factors - ones that might save you a bundle in the long run and keep your firm from blundering. To avoid pitfalls in this area, list and evaluate your top priorities for a leasing arrangement. Consider factors such as: choosing the right leasing partner, balance sheet considerations, tax considerations, choosing the right form of lease, avoiding severe lease terms, and getting enough lease flexibility.
Failing to Check Lessors' References and Financial Condition
As Rod McHenry discovered, perhaps the area with the greatest potential for a misstep is lessor selection. Failing to investigate and make a wise choice of leasing partner can result in transaction delay, misrepresentations, nonperformance, unexpected fees or even fraud. Like many industries, equipment leasing encompasses many players with varying degrees of experience, specialization, integrity and financial strength. In selecting the best leasing partner, get sufficient information from bidders to perform an effective reference check. If possible, also obtain financial information from bidding lessors to evaluate their financial condition. Obtain Dunn and Bradstreet reports on each bidder. Ask for and check customer, vendor, bank and trade references. Perform an Internet news and message board search to make sure the bidding lessors are not the subject of any unresolved problems or scandals. Most reputable lessors belong to one of the major equipment leasing trade associations (ELA, EAEL, UAEL, or NAELB). Call the appropriate association for a reference. Lastly, ask around. Check with your attorney, accounting firm, banker, friends and associates who are able to make recommendations based on past experiences.
Not Fully Understanding the Lease Agreement
Failing to read and understand the major terms and conditions of the equipment lease can cost your company a bundle. While most lease agreements include similar terms and conditions, there can be noticeable differences. For example, most agreements cover the lessee's responsibility to pack the equipment and ship it to the lessor at the end of the lease, if the lessee chooses to return the equipment. Some leases require the lessee to have this done by the last day of the lease, perhaps depriving the lessee of a week or more of use. Also, some agreements require the lessee to pay for equipment de-installation, packing and shipping to any destination within the US, which can be costly. You can save money by negotiating many of these points. Read the lease agreement thoroughly, get legal advice if necessary, and negotiate points that can save you money.
Making the Wrong Choice Between Fair Market Value and Bargain Purchase Leases
High on the list of potential leasing blunders is choosing the wrong form of lease for your planned use of the equipment. Failure to choose wisely can result in significant additional lease expense. Equipment leases fall into two broad categories: 1) leases designed to pass ownership of the equipment to the lessee at the end of the lease (bargain purchase/capital leases) and 2) leases intended to allow the leasing company to retain ownership of the equipment (FMV or operating leases).
If you plan to keep the equipment beyond the term of the lease, it is generally cheaper to enter into a bargain purchase/capital lease. During the lease, you pay the lessor a rate of return plus the cost of the equipment. At the end of the lease, you receive the equipment title for a nominal payment. If the equipment is subject to rapid obsolescence or if you feel confident that you will return the equipment at the end of the lease, a FMV or operating lease might prove advantageous. What you are getting in a FMV or operating lease is the flexibility to kick the equipment out at lease end. Additionally, this form of lease can lower your lease rate as the lessor passes a portion of the anticipated residual value back to your firm in the form of lower payments. If your firm has reason to minimize liabilities appearing on the balance sheet, perhaps due to bank financial covenants, an operating lease might be appealing. In these lease situations, balance sheet concerns may trump the desire to obtain the lowest lease rate. In choosing a lease form, look at the period of intended equipment use, the potential for equipment obsolescence, balance sheet considerations, income tax considerations and any other factors that might influence lease choice.
Failing to Evaluate Vendor Service - Equipment Lease Arrangements
Entering into a 'hell or high water' equipment lease involving proprietary equipment required for a multi-year service (such as alternative energy or telephone services) can lead your firm into a situation ripe for blunder. Even under the best of circumstances, a 'hell or high water' equipment lease (one requiring non-cancelable payments) entered into in connection with a service arrangement carries a certain degree of risk. In many cases, the lease is provided by a leasing company independent from the service provider or later sold by the service provider to a lessor. The potential pitfall results from the possibility that your company might get stuck making lease payments for equipment it can no longer use, should the service provider fail or cease to offer the service. The best protection against this potential pitfall is to avoid these types of arrangements. If you must enter into such an arrangement, make sure the service provider is financially sound, reputable, and has a long track record of providing excellent service. Also, since these transactions always carry some risk, make sure that an abrupt interruption in the service will not have a material negative impact on your company or cause financial hardship.
Ignoring End-of-lease Notice Deadline
While not a deadly blunder, failing to give timely notice at the end of your lease can create significant additional lease expense for your firm if you plan to return the equipment. Many leases have provisions that require the lessee to notify the lessor of the lessee's decision to return the equipment at the end of the lease. If you violate the notice period, the lease kicks into an often unfavorable automatic renewal period, usually one to six months. If you intend to return the equipment at lease end, make sure your firm gives notice on time. It can save your firm a bundle in avoidable lease expense.
Underestimating Time Required to Close Lease
Not allowing enough time to go through the lease planning, proposal, approval and documentation phases can result in extra cost. A rushed process can lead to poor lessor selection, approval delays, documentation miscues or poorly negotiated lease terms. Except in small ticket transactions (under $ 75,000 to $ 100,000) where personal guarantees of the principals are involved, most lease transactions take at least three weeks or more to close. While some of the time is consumed in the bidding and credit review processes, much of it can be eaten up by administrative matters. Obtaining insurance certificates, filing UCC financing statements, reviewing and negotiating the lease agreement, all contribute to the time it takes to get to a lease closing. The best way to manage the lease closing process and to save precious time and money is to plan ahead. Make sure you establish criteria for the lease you are seeking, prepare a package containing information all bidders would want, obtain a lease closing list from each lease bidder, and respond to all requests/questions raised by bidding lessors on a timely basis.
While equipment leasing pitfalls can not always be avoided, you can take steps to prevent snags that can cost your firm a mint. Plan ahead and do your homework before launching the lease bidding process. Give high priority to selecting an experienced lease provider with high integrity and good expertise. Also, with lease transactions that represent significant obligations for your firm, engage a competent attorney to help you review and negotiate the equipment lease.
George Parker is a Director and Executive Vice President of Leasing Technologies International, Inc. (�LTI�), responsible for LTI�s marketing and financing efforts. A co-founder of LTI, Mr. Parker has been involved in secured lending and equipment financing for over twenty years. Mr. Parker is an industry leader, frequent panelist and author of several articles pertaining to equipment financing.
Headquartered in Wilton, CT, LTI is a leasing firm specializing nationally in direct equipment financing and vendor leasing programs for emerging growth and later-stage, venture capital backed companies. More information about LTI is available at: http://www.ltileasing.com .
Article Source: https://EzineArticles.com/expert/George_Parker/1052
http://EzineArticles.com/?Equipment-Leasing-Blunders-That-Can-Cost-Your-Firm-a-Mint&id=10072
Ten Equipment Leasing Tips - Save a Bundle on Your Next Lease
By George Parker
According to the Equipment Leasing Association ("ELA"), U.S. businesses lease every thing from laptop computers to commercial airplanes, racking up more than $ 200 billion in equipment leased each year. Although four out of five U.S. companies use leasing to acquire equipment, many don't know the ins and outs of leasing well enough to negotiate a good deal. By focusing on a few key aspects of the lease transaction, you can save a bundle on your next lease and eliminate potential aggravation.
1. Choose the Right Leasing Partner
The starting point for saving money on your lease is to select the right leasing company. The biggest savings in this area come from saving time and dodging substandard lease transactions. The wrong lessor choice can result in a slow approval, inability of the lessor to deliver, hidden fees, a poorly designed lease transaction or worse. Give this aspect of obtaining a lease your highest priority. To save a bundle on your next lease, you must do your homework in pre-qualifying bidding leasing companies. Look for lessors with: 1) experience and knowledge; 2) good reputations; 3) the ability to perform; 4) helpful business contacts; and 6) a relationship approach. Ask for and get lessor financial information, background information on the key managers, a listing of recently completed leases, and contacts at key funding sources for each leasing company being considered. Review this information and follow up with all contacts provided.
2. Choose the Right Lease
You can rake in big savings by obtaining the right lease for the equipment you are acquiring. When planning your lease financing, determine the top three or four attributes your lease should have. During this process, carefully evaluate the importance of: lease pricing, lease flexibility, balance sheet considerations, equipment obsolescence, the anticipated period of equipment usage, and your firm's credit status. The wrong lease choice can be costly.
Lease pricing is market driven, so get at least three lease bids. Carefully evaluate bids by doing a comparative analysis of discounted cash flows incorporating all anticipated costs and fees. Make sure your lease has favorable end-of-lease options, a reasonable end-of-lease notice period, the ability to relocate equipment by notifying the lessor, the right to terminate the lease early without an onerous charge, and the right to assign the lease to another user under agreed upon conditions. Look for an arrangement that will cover equipment needs for at least the next six to twelve months.
Big savings can be realized by knowing when to select a lease with a bargain purchase option versus a fair market value option. If you know you will be keeping the equipment beyond the initial lease term, a bargain purchase option is usually the most cost-effective alternative. If the equipment is prone to obsolescence or if it is unlikely you will retain the equipment at the end of the lease, consider a lease with fair market value, end-of-lease options.
Know your firm's credit standing. If your firm has been in business for a number of years, is profitable, has a good track record and has a strong balance sheet, it deserves great lease pricing and terms. If your firm has a spotty credit record or weak balance sheet, the challenge is to get the best deal possible. Identify and offer credit enhancements that will make your transaction more attractive. Allow plenty of time to get through the credit review and due diligence process.
3. Ask for Fair Market Value 'Caps'
If you decide that a fair market value lease is the way to go, you can realize big savings by limiting that value. Fair market value rental and purchase options at the end of the lease allow the lessee to either continue leasing the equipment or to buy the equipment at the then fair market value. These values are generally quoted by the lessor at lease end based on aftermarket data, but most leases allow the lessee to obtain an appraisal from a qualified equipment appraiser. To realize significant savings and to eliminate unpleasant surprises, request fair market value options that are "capped" (have upper limits). Beware, however. Lessors may insist on fair market value 'floors' (lower limits) when they agree to 'caps'. The availability of a fair market value cap will depend on the size of the transaction (may not be available on small transactions), competition among lessors, and the credit status of your firm.
4. Keep the End-of-lease Notice and Renewal Periods Short
To avoid hefty unintended lease charges, seek notice and automatic renewal periods that are short. The primary purpose of the end-of-lease notice period is to allow the leasing company sufficient time to redeploy the equipment if you elect to return the equipment. The secondary purpose is to notify the lessor of your plan to either continue leasing the equipment or to purchase it. The notice period generally ranges from one to six months, with three months being typical. If you violate the notice period, the lease kicks into an often unfavorable automatic renewal period, usually one to six months. If the lessor is unwilling to negotiate this provision, you can save money by making sure the notice requirement is fulfilled within the allowed time.
5. Slash Interim Rent
You can slash lease costs significantly by limiting interim rent. Interim rent is the rent you pay for daily use of equipment between the equipment acceptance and lease start dates. The rationale for interim rent is that you have use of the equipment and the lessor is obligated to pay the equipment vendor during this period. While the rationale is not unreasonable, interim rent can balloon lease pricing by arbitrarily extending the term of the lease (albeit by only days). The best approach is to schedule equipment delivery and acceptance toward the end of the month. Most lease terms officially start the first day of the month following equipment acceptance. Another strategy is to negotiate a truncated period at the end of the lease such that the interim period and truncated period total one month of the quoted lease term. A last strategy is to request a limit on interim rent (perhaps ten or fifteen days) regardless of equipment acceptance.
6. Manage Equipment Returns
Save a bundle on your lease by managing the equipment's return. Although you may not anticipate returning the equipment to the leasing company at lease end, it can be costly if you do. When equipment is returned, most lessors care about and will hold your firm accountable for the equipment's condition. Equipment should be properly maintained and returned in good condition. Make sure that you understand the return provision of the lease and that you have good internal controls to adhere to these requirements. If the lease contains an 'all or none' return provision, one strategy is to subdivide the lease into several smaller lease schedules on the front end. Place equipment you are most likely to keep on the same schedules. Try to negotiate the right to return up to 20% of the equipment (based on original value) at the end of the lease, as long as you agree to renew the lease or purchase the balance of the equipment. Track and save all equipment accessories and documentation.
7. Match Lease Term with Projected Equipment Use
The term of the lease should match the expected use of the equipment as closely as possible to save money. If the term is too short, cash outlays for the equipment might exceed the expected equipment benefits over the term. If the lease term is too long, you might lose the flexibility of upgrading to newer more desirable equipment. Notwithstanding your preferences, the term allowed by the leasing company may depend on their perception of credit risk and the expected economic life of the equipment. Any mismatch between your preference and lessor's can be managed by obtaining favorable end-of-lease options.
8. Identify and Understand All Potential Fees
Leasing proposals vary in the types and amounts of fees and penalty charges. Common fees and charges include: commitment fees; non-use fees or facility fees; per schedule documentation charges; attorney fees; UCC financing statements; penalty charges for late rental payments; and early lease termination charges. These are only a few of the possible fees and charges. You can save a bundle by carefully going through each lease proposal and lease agreement to identify and compare likely charges. If fees or charges are significant and likely, they should be incorporated into your pricing analysis. Where possible, especially where one proposal contains fees/charges excluded from the other proposals, try to negotiate these fees/charges.
9. Offer Credit Enhancement to Reduce Lease Rates
In some cases, you can trim lease pricing substantially by offering credit enhancements to improve your firm's credit profile. Enhancements can include: shortening the lease term, cash or other assets as additional collateral, personal or corporate guarantees, advance rentals payments, and security deposits. Since most credit enhancements involve giving up something of value, do a cost/benefit analysis to determine whether the net benefit is in your favor. If your firm has assets that are not working for it why not put them to work in the leasing arrangement. The value of credit enhancements can differ from lessor to lessor, so identify and discuss possible enhancements upfront. Try to assess whether your firm's credit will improve significantly by credit enhancements and get lessors' pricing with and without the credit enhancements.
10. Request Several End-of-lease Options
If the lease contains a nominal purchase option, there is little need for additional end-of-lease flexibility. Otherwise, flexible end-of-lease options can save you a bundle by preventing you from incurring extra expense. One of the most cost-effective options is the ability to return the equipment at the end of the lease. If you no longer need the equipment, why incur additional charges? Additionally you should have the ability to purchase the equipment at a fair or reduced price and the right to continue leasing the equipment at a fair or reduced rent. As discussed, use of caps in fair market value purchase or rental options can greatly reduce potential costs at lease end.
Conclusion
Saving a bundle on your next lease is a cinch if you know where to look. By focusing on a few key areas, you can wring huge savings out of your lease. Remember to set your priorities in evaluating lease proposals and to choose the right leasing partner. Also, while front-end lease pricing is usually a high priority, evaluate each lease carefully to sniff out hidden fees and expenses. Don't be bashful about negotiating points in the lease that have the potential to save you a bundle.
George Parker is a Director and Executive Vice President of Leasing Technologies International, Inc. (�LTI�), responsible for LTI�s marketing and financing efforts. A co-founder of LTI, Mr. Parker has been involved in secured lending and equipment financing for over twenty years. Mr. Parker is an industry leader, frequent panelist and author of several articles pertaining to equipment financing.
Headquartered in Wilton, CT, LTI is a leasing firm specializing nationally in direct equipment financing and vendor leasing programs for emerging growth and later-stage, venture capital backed companies. More information about LTI is available at: http://www.ltileasing.com
Article Source: https://EzineArticles.com/expert/George_Parker/1052
http://EzineArticles.com/?Ten-Equipment-Leasing-Tips---Save-a-Bundle-on-Your-Next-Lease&id=6185
Other Benefits of Equipment Leasing For Small Business Owners!
By Richard Bonomo
Finance companies are on the cutting edge in supplying small business owners the ability to lease equipment that there local banks will not do. A equipment finance company furnishes you the edge you need in your business with acquiring state-of-the-craftsmanship equipment.
More extensive options with lesser costs - with a leasing course of action you are allowed to select your choice of equipment without paying the maximum. This preference, likewise, accompanies the way that generally business equipment leasing companies will frequently handle everything from the support for the leased equipment. Your company can safeguard the expenses connected to the equipment as the leasing company ordinarily gets cost cuts on equipment with identified equipment vendors if they purchase in mass.
State-Of-The-Art Equipment - When a company gives your business an equipment lease, they furnish the best leasing terms possible. They do this since unlike your business, equipment leasing is the main business they do and their rivalry is steeped in demonstrating to you the best equipment at the most minimal costs. Provided that they don't furnish the best equipment at the best costs their competition assumes control, so the company paying for leasing gets all the identified profits of getting the best equipment at a modest cost.
Adaptable Arrangements - With an application in action, leasing equipment per your requirements is made easy. Leasing might be orchestrated consistent in the way you aim to utilize the equipment in your business. You can additionally renegotiate the terms of your lease if your circumstances change, and this comes without any repercussions. Some business companies, likewise, handle the protection of their equipment so insurance protection is needed for your equipment.
Leasing Options!
With the different companies accessible in the market place today there is scarcely an altered situated for leasing alternatives. Companies will give leasing choices and tailor them as per the requirements of their clients. In this guide, we have chosen a percentage of the most widely recognized business alternatives accessible nationwide, which could be discovered over a mixed bag of companies in the U.S. today.
The equipment lease offers the business owner the alternative to purchase the equipment at a highly decreased rate at the closure of the lease period. This equipment lease is additionally alluded to in a years as an ostensible buyout lease agreement. With an equipment lease, the organization purchases the equipment it requires and offers it to the business leasing the equipment. The finance company can then lease the equipment again to your business for its ordinary utilization. The Municipal Lease choice is accessible to open offices and additionally non-benefit conglomerations. In the event that your organization falls into these classes you can make requests concerning this alternative. With the Deferred Payment Lease, the first regularly scheduled installments of such leases are ordinarily conceded to a time of up to 90 days soon after the lease begins. With the Seasonal or Skip Payment, the tenant pays for the lease at top times of the working year, which are characterized whenever the timing is ideal. With the True Lease, the business might decide to profit by the leased equipment to finish of the lease or might purchase the equipment at a reasonable cost of the equipment. With the Graduated Lease, the leases begin off with modest regularly scheduled installments that ascent consistent at the level of expanding wages your business produces.
Start-Up Restaurant equipment leasing for quick and easy funding for small-business owners that need equipment to start a new business or for an existing business. With an equipment leasing application in action, leasing equipment per your requirements is made easy. Leasing might be orchestrated consistent in the way you aim to utilize the equipment in your business. You can additionally renegotiate the terms of your lease if your circumstances change, and this comes without any repercussions. Some business equipment leasing companies, likewise, handle the protection of their equipment so insurance protection is needed for your leased equipment.
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