How Does It Work?
The item is purchased by the asset finance funder, who will then rent the item to you over an agreed term. A small initial payment is usually required, followed by a fixed monthly rental payment.
During the term of the lease, customers will usually be responsible for any servicing, repairs and maintenance that is required.
At the end of the required lease period, there are normally three options available:
- Extend the lease and continue to use the item as needed.
- The item can be handed back to the lender, with no further involvement from your business.
- The lender can sell the item and will usually allow you to share in a portion of the sale price.
Is a Finance Lease Right For My Business?
Choosing the right asset finance solution for your business can be a complex decision. There is often little difference in cost between a finance lease and hire purchase. The decision often comes down to how it will affect you from a taxation point of view.
What Happens at The End of The Lease?
The process for handling the end of the lease will be clearly laid out by the provider upfront. Each agreement will have it’s own way of dealing with it, but it is usually one of the following:-Hand the item back: If the item is no longer required, you can hand the item back at the end of the lease.Extend the lease: Where the item is still required, you can often extend the lease. The terms are usually negotiated on extension.
Who Can Apply for A Finance Lease?
We can offer finance leases to UK business owners whatever the ownership structure of the business. Some of the more common ownership structures we work with are:-Sole tradersPartnershipsLLPsLimited Companies
How Do I Get the Best Deal?
As with any finance or insurance agreement, the key to securing the best deal is to compare offers from a number of providers. On top of the cost, there may be other terms and conditions that work better for you with one provider than another.
Purchasing new equipment for your business can be the key to driving your profitability to the next level. As such, it’s crucial that you make good decisions when finding the perfect finance partner.
At ABC Finance, we’re asset finance experts and we shop around for you. We work with lenders across the market to find the best deal for you.
To get started with your asset finance application, talk through your circumstances with an expert now. Either call us on 01922 620008 or enquire online.