There are several advantages to leasing your equipment over taking out a traditional loan. If you have any questions about how this could work for your company please contact one of our leasing specialists today at 913-381-7900.
|A lease requires no down payment and gives you flexible end options.||Down Payment||A loan requires a down payment and will finance only the remaining amount.|
|The equipment itself is usually all you need to secure a lease.||Collateral||A loan generally requires a pledge of other assets for collateral.|
|A lease does not contain restrictions against borrowing future funds. As long as you are current with your terms and conditions the lessor cannot disrupt the use of the equipment.||Future Funds||A loan agreement usually includes restrictions that require the customer to maintain certain financial ratios that may restrict borrowing money in the future.|
|The risk of obsolescence is reduced as there is no obligation to own the equipment at the end of the lease. You can also build in necessary upgrades as well.||Obsolescence||You bear all the risk of equipment obsolescence because of advances in new technology.|
|With a true lease you can usually claim the entire lease payment as a tax deduction.||Tax Advantages||With loans you can usually only claim interest and depreciation as deductions.|
|Leased assets can be expensed and would not appear on the balance sheet which would improve your financial ratios.||Balance Sheet||Loaned assets must appear on your balance sheet as an asset with a corresponding liability.|
|More of the cash flow occurs later in the lease term when inflation makes the dollar cheaper.||Hedge Against Inflation||A larger portion of the financial obligation is paid with today’s more expensive dollars.|