Getting equipment to run a business is costly, and that makes it hard for startups especially. Many companies lease equipment instead of buying it as a result. Leasing is done by financial institutions who buy the equipment and rent it back to the person who is getting the lease. At the end of the lease, the business owner usually has options like giving the equipment back, leasing it again, or purchasing it. The advantage is getting your needed equipment without going broke, and sometimes lease payments are tax deductible. The downside is you will pay more in the long run, and you are obligated to pay the lease payments for the whole term of the contract. The top three leasing companies out there are SLS Financial, Baycap, and Banker's Capital.
Virtually anything you use to run your office or business. This can be computers, office machinery, heavy construction equipment, automobiles, basically anything you use in your business. Small things like copy paper that are used up, would not be included.
What are some things to look out for?
Read your contract carefully. You want to make sure you know what you are responsible for when it comes to damaged equipment. Make sure you understand who is responsible for maintenance and repairs to the equipment to avoid surprises.
Is it hard to get leasing for equipment?
If you are an established business with good credit, it will be very easy. If you are a new business with not-so-good credit, it will be difficult. Lenders are more hesitant to lend or lease, to startups. When they do, it is to those with excellent credit ratings.
What are some things to look for when considering getting a lease?
The company should be transparent as far as the terms of the deal, and their pricing. Look out for misleading information on their marketing materials. A good company will be straight with you on whether you will qualify.
What makes SLS Financial a good choice?
SLS is one company that does lend to startups. This company specializes in startups and companies with bad credit. The company has a good reputation for being transparent in its dealings as well. They also lend to established businesses.
What is significant about Baycap?
Baycap works with big businesses, with leases of $75,000 and up. They are looking for companies with average or better than average credit. They are not always easy to get a loan with, but they have good interest rates, and this company will do startups.
Why would you choose Banker's Capital?
If you cannot get a loan anywhere else for your equipment, there is a good chance you can get it with Banker's Capital. This company emphasizes that it will loan to "any" industry. They keep their rates low by using more collateral than other institutions.
What are some other advantages to leasing?
A lease is technically not a loan. You will not be maxed out on your credit by leasing, keeping money free to use on other parts of the business. Another advantage is leasing allows you to upgrade your equipment at the end of the lease, if you renew, without any extra expense.