Questions & Answers About Leasing
What types of assets can be leased?
Who can lease?
What are the rates?
Can a lease be cancelled?
Who is responsible for maintenance and insurance?
Is a down payment required?
Are personal guarantees required?
Q: Why Lease?
A: Leasing has become one of the most widely used methods of financing for equipment and machinery acquisitions by businesses. In fact, according to the United States Equipment Lessors Association (ELA), 80% of all businesses use leasing to acquire some or all of the machinery and equipment they use to run their business. Here are just some of the reasons why:
- Capital Preservation
- Credit Preservation
- Easier Budgeting
- Financial Efficiency
- Tax Deferral
- Established businesses of all types
- New businesses and Start-ups
- All Industrial and Manufacturing sectors
- Institutions and Non-Profit Organizations
- Universities and School Boards
- All levels of Government
- Hospitals, Medical and Dental practices and clinics
- Professionals and Consultants
Top Q: What are the rates?
A: Alliance continually strives to provide the most competitive
lease rates available. Rates are dependent upon the customer’s credit profile,
length of time in business and industry, as well as on the type of equipment,
size of transaction and term/structure of the lease. Top Q:
Can a lease be cancelled? A: Generally speaking, no.
The lease is a legally binding contract. It can not be cancelled by the Lessor
or the customer. Most leases have provisions whereby the customer can trade-in
the equipment, or can pre-pay the lease. Some of the leases arranged by Alliance
are structured so as to be open without penalty after a specific number of months
have elapsed. Top Q: Who is responsible for
maintenance and insurance? A: The customer is responsible for maintaining and
insuring the equipment. Top Q: Is a
down payment required? A: Generally, for customers who
meet the minimum credit and length of time in business requirements, no down payment
is needed. On execution of the lease, an amount equal to first and last month’s
lease payment is all that is required. Top Q:
Are personal guarantees required? A: Provided that the
business meets certain minimum credit requirements, no personal guarantees are
required. In some instances another related business can act as a guarantor for
a lease, rather than having owners or partners act as a guarantor.