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Leasing Facts
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What is a lease?
A contract by which the owner of the equipment (Lessor-Leasing Company)
grants to another party (Lessee-meaning YOU) the right to possess and use
the equipment for a specified period of time in exchange for a stipulated
periodic payment (rent). At the end of the term in a lease, the lessee
(YOU) may have certain purchase options to choose from.
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Who can lease?
All types and sizes of businesses lease equipment. Any qualified business
from a proprietorship to a public corporation can lease equipment. 8 out
of 10 companies uses leasing to acquire equipment.
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What is the purchase option?
A purchase option is a provision in the lease that gives the lessee (YOU)
the right to purchase the equipment at the end of the lease for an amount
specified or its future fair market value.
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What are the lengths of
terms available under a lease?
Leases can be written for standard terms of 24 to 60 months depending upon
the type of collateral and your credit.
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What kinds of rates are applicable to a lease?
Lease rates are based on several factors including; capitalized costs,
length of term, types of collateral and your credit.
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How does leasing work?
You select the equipment you want and terms that meet your company’s
individual financial needs.
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How much is the down payment?
In most cases, we can provide a lease for 100% of the full purchase price.
Sales tax is paid on the monthly payment instead of up-front.
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What are the advantages of leasing?
Conservation of CAPITAL-leasing increase the power of your capital by
keeping credit available for short term needs and not tied up in fixed
assets.- 100% Financing-eliminates the need for a down payment
- Flexibility-Longer terms and lower payment structured to fit your budget
- Improved Cash Flow-Pay for the uses of the asset, not the ownership.
- Credit Diversification-Keeps lines of credit available to respond to
opportunities
- Fixed Payment-Lock in payments-easier financial planning
- Obsolescence Protection-Avoid the risk of owning obsolete equipment
- Options-Purchase/Renewal and Return options available
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