Benefits of Financing

Convenience – Do you want to spend your time chasing down financials, reports on the business and principals, and tax returns for the last several years. Do you enjoy filling out tedious application packages for a bank when you should be running your business?  Of Course Not! So don’t get caught in the rat race -Choose leasing. Your simple one-page lease application is usually the only document needed to get the lease process rolling.  This takes the bureaucracy out of financing equipment for businesses with a very quick turn-around period. Applications can be approved within 24 hours!

Flexibility - Do you have slow months or unexpected cash flow problems? Leasing is very flexible. Leasing provides you with greater structuring flexibility such as number of months (term), differing purchase options, and flexible payment plans (no payments, deferred payments, seasonal payments, low payments). It’s that clear and easy.

Avoid the risk of owning obsolete equipment - With the digital revolution upon us, where are the benefits of owning obsolete equipment? Is your equipment affected by add-ons, updates, revisions, or new technology? You don’t want to be stuck holding the bag on obsolete equipment. Leasing allows you the flexibility to upgrade, and/or replace your equipment to keep you in the running with your competition, giving you the competitive edge! 

Smart business owners know that the real value of their equipment is in the revenue it generates.  Wouldn't you agree?  Leasing gives you peace of mind with obsolescence protection.

Save cash flow and working capital - Did you ever spend cash and later realize, "Wow, I could have used that cash for something else (i.e. unforeseen expenses, payroll, advertising)"? Now, you’re stuck in the horns of a dilemma trying to figure out where you're going to raise enough cash to pay for those unexpected expenses. 

One of the biggest problems most businesses have is running out of cash or working capital. But there’s a solution. Leasing provides you with another source of funding your new equipment outside of spending your hard earned cash.

Would you pay your employee a large lump sum of money up-front for future performance (unless your in Pro-Sports)?  So why would you do that with your equipment by paying a large lump sum of your hard-earned capital? 

Save your cash and working capital for important long-range plans such as expansion, improvements, growth, accounts payable, personnel, marketing, or research and development. Let the equipment pay for itself.  Leasing is a new source of money that will save your cash flow and put it where it’s needed most, in your business.  Now, that’s money well earned.

Tax benefits - Do you want to take advantage of tax benefits? Leasing may offer you tax benefits you didn’t realize. Tax benefits that allow you to deduct monthly payments from taxable income. Monthly payments on operating leases are typically viewed as operating expenses and can offer significant tax benefits. Generally, leases with shorter terms as 36 months may save you big money in the long run. 

When equipment is purchased with cash or a bank loan the customer must depreciate the asset over its economic life. Whereas, deducting the entire payment reduces taxes and may be more advantageous than depreciation when the lease is shorter than the depreciable life of the equipment. * You should always consult with your CPA to determine the most tax beneficial lease for your company. You wouldn’t necessarily pay an employee a large sum of money up-front would you? (Unless you’re in Pro-Sports) So why would you pay a large sum up-front for your business equipment?  When you look at the big picture it just doesn’t make "cents"!

According to a recent business survey on working capital, when you pay cash up-front you lose 17% on every dollar that you pay out. What does that mean? On a $10,000 piece of equipment not only are you out  $10,000 in hard earned cash, but in your first year alone, you loose $1,700. This working capital could have best been re-invested in growth, advertising, or unexpected expenses.

Leasing allows you to put your cash flow back into the business where it is needed the most. You might say, "but I want to own the equipment". Great, we have an end of lease purchase option that allows you to buy your equipment. But let me share a little secret with you that the Fortune 500 companies know, the real value of the equipment is in its use.

Utilizing the essential use equipment productively generates enough profits which should far exceed your low monthly lease payments. In essence, you have equipment working just as hard as you are and paying for itself! Use your capital for more important things like growth, investments, and expansion. Right?

Fast, easy approvals - What does this mean? Fast and easy as in a simple 1-page application, this is all it takes for you to get approved within 24 hours! Typically requests for up to $50,000 and some cases $250,000, can be approved with only a 1 page application. How’s that for fast? On a good day you’ll be lucky to get through the bank lines in 24 hours. Let alone, filling out the bank’s tedious application packages that request that you chase down financial statements, reports on the principals, and tax returns for the last seven years. 

Besides, wouldn’t you rather spend your valuable time running your successful business? Leasing provides you a quick turn around period which equates to convenience and more time for you to spend on running your business. Alleviate personal debt and free up personal credit. Leasing keeps your capital sources and personal lines of credit open and available to you in case they’re needed for short-term requirements. You never know when the budget is going to put a squeeze on your spending.  So why not keep your other avenues open? Leasing usually provides a non-conflicting source of credit, thereby increasing the customers’ borrowing base. When structured properly, the ‘lease debt’ will not be listed as a liability on your financial statements (off-balance sheet financing). This may allow you to preserve your borrowing availability with your bank and other creditors. You win with a better debt-to-equity and earnings-to-fixed asset ratio. 

Don’t waste your personal line of credit only to find out too late you should have leased.

100% Financing - With a lease you can be comfortable in the fact that you can finance 100% of the equipment. Traditional lenders and banks will normally offer 70-80% financing leaving you with a problem. Where are you going to come up with the other 20-30% to put down? 

Leasing provides you with minimal up-front cost and the flexibility to tailor a plan that meets your business needs. If saving your cash flow is important to you and if you're going to finance your commercial equipment doesn’t it make sense to get 100% of it done?