It can be hard for a new or existing business to decide which type of industrial equipment leasing or buying is best. There are many industrial equipment financing options available to suit all business types, including those with bad credit and those that only work part-time. To give new businesses the boost they need, certain plans were also created. There are many types of plans that you can choose from.
Leasing of Traditional Industrial Equipment
Companies who do not want to own the items but wish to rent them can opt for traditional leases. These leases have no buyout terms and low monthly payments which are tax-deductible as an operating expense. These are especially useful for equipment that is likely to depreciate quickly. It is possible to purchase the equipment you require at a fair price, and then extend the term to suit your needs.
Capital or Pre-Paid
This financing for industrial equipment works in the same way as a traditional lease, except that the item is purchased at the end. To transfer ownership, you only need to pay a small amount of the original price tag. You can often pay a portion of the purchase price upfront to lower your monthly payments. This will also show that you are able to make the payments. These are great for people who need extra credit.
Deferred payment programs, which are the same as traditional or capital industrial equipment lease options, are a great choice for new businesses. They are set up so that the company doesn’t have to pay any payments for the first two or three months. Businesses with low incomes can start to get moving before they have the money they need to pay for the equipment.
Seasonal payment programs are designed for seasonal businesses or organizations, such as those in the road construction and agricultural industries. They can be used to pay cash only during certain months or seasons. They can be customized to suit the company’s needs, including the amount and length of the term, as well as the number of payments per year. Sometimes, small payments may be required during the off-season.
Industrial Equipment Financing
Sometimes, a company buys the equipment they need and then discovers that they want to increase their cash flow or invest in equipment that has a higher value than it depreciates. A sale-leaseback is when the company sells the equipment to a financial institution and then leases it back until the full payment or until the end of their lease.
This type of industrial equipment lease is often preferred by contractors, especially when they’re purchasing items for contracts that will increase their income on a regular basis. These plans allow for the payment to increase with the income, and the plan is paid out sooner.
Master Lease Programs
Companies that plan to purchase multiple pieces of industrial equipment within a short time frame can benefit from master industrial equipment financing. Once the main agreement has been signed, a separate agreement for each item is created.
These are just some of the many options for industrial equipment leasing available to businesses. Many financing companies will work with you to find the right industrial equipment financing for you. They will help you get the items that you want at affordable payments.
Reach out to us today if you are looking to finance industrial equipment!