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Advantages of Leasing
- Less impact on cash flow.
- Reduced paperwork and approval time.
- Most lease credit decisions can be made within 24 hours. Transactions up
to $100,000 require completion of only a simple, one-page application.
- Conservation of capital and credit.
- Your lines of credit and sources of capital aren't tied up in equipment.
Instead, they're available for opportunities such as inventory, marketing,
or personnel.
- Immediate use of equipment.
- After signing your lease documents, you can contact the vendor to schedule
delivery. It's that easy.
- Project basis use of equipment.
- By selecting a lease term that closely matches the project's duration,
leasing is a good way to acquire the latest equipment without having to keep
it when that project is complete. Then, enter another lease on new equipment
for the next project. This way you'll always be able to maintain a
competitive edge by using the most advanced equipment to serve your clients.
- 100% financing - including soft costs.
- In addition to financing 100% of the equipment, you can include
"soft" costs (up to 10% of the equipment cost) such as sales tax,
shipping, software, training, maintenance and installation into the lease.
- Protection against obsolescence.
- Tax benefits.
- For certain leases, you can deduct monthly lease payments as an operating
expense. Moreover, leasing may help your business avoid the Alternative
Minimum Tax (AMT).
- Improved balance sheet ratios.
- Unlike the traditional methods of financing, operating lease obligations
generally are not capitalized, improving balance sheet ratios.
- Options for purchase or renewal.
- At the end of the lease you may choose to purchase your equipment, upgrade
it, or continue to lease it. Or, if you're done with the equipment, return
it.
- Reduced interest rate risk.
- By locking in fixed payments now, you can avoid the risk of inflation in
the future.
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