Want a bulldozer but can’t buy it? Well, you ‘ll be able to afford it if you consider equipment leasing. Often you need (more) heavy equipment to establish or improve your business. However, they are often very expensive and it’s often quite difficult to buy them all. Leasing is the greatest option in such situations. In fact, the convenience of equipment leasing is so decisive that even the large companies often go for it. It sounds a little strange but the fact is that over 80% of all the companies in the United States use heavy equipment leasing for their businesses. This statistic is provided by the ELFA or the Equipment Leasing & Finance Association. However, when you consider the benefits of leasing heavy equipment, you will understand why this is such a popular option. The greatest benefit of leasing is that you are paying only for the value of the equipment that you are using for a specific time. Naturally, it is a more cost effective option than purchasing the equipments. Generally, the equipment leasing company buys heavy equipments from the companies that are looking to sell them. As they now own them, they rent it to the clients for a monthly payment. However, the equipments are assigned to a client for a fixed period of time. There is no limit as far as the payment options and the term of use is concerned and it is this abundance of options that is so beneficial to the owners. There are different types of equipments that are available for lease. For example, you can lease computers, medical equipment, farm equipment, heavy equipments... Again, leasing can benefit the financing of many other sectors. The benefits of equipment leasing are abundant. First of all, it allows you to use the latest models and equipments in your business avoiding obsolescence. Also, you don’t have to worry about technological degeneration. There are different flexible terms and conditions regarding equipment leasing to make it more useful for your individual needs. In most cases, there is no need to make any down payment and or tie up collateral. This is particularly helpful for start ups. Also, when you consider an equipment lease rather than buying it, you can hoard some money in the bank for a little longer. This money can be used to improve other important areas of the business. In most cases, the lease requires smaller/less frequent payments than ordinary loans. So, it is useful in this respect as well. Also, the lease obligations are not carried in the balance sheet. What’s more, the payments made are often tax deductible. Another great advantage of the lease is that it is easily available. In fact, in most cases if the lease is below $100,000, it is as easy as an application for a credit card. However, if it crosses the limit of $250,000, you need to provide financial details.
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Want a bulldozer but can’t buy it? Well, you ‘ll be able to afford it if you consider equipment leasing. Often you need (more) heavy equipment to establish or improve your business. However, they are often very expensive and it’s often quite difficult to buy them all. Leasing is the greatest option in such situations.
Eric LeRiche is author of this article on Commercial Construction financing. Find more information about Farm Equipment Leasing here.
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