CARTOONS BY CHRIS BRITT

– LEASING –
Equipment can suck
up cash flow in any
company. If you need to
make major purchases,
and don’t want to tie up
your cash, leasing may be
the way to go. This allows
you to add new equipment
without having to empty
your bank account. This
can be perfect for cash
strapped companies. In
many cases, equipment
leasing resembles the
loan you would take for
purchasing. You get full
The best things in life are free, but the optional
accessories really run up the bill.
use of the equipment but on a long-term rental basis. The best part is that ownership
rests in the hands of the financial institution or leasing company, so they are responsible
for the overall condition and repair of the equipment if you have a maintenance plan
included in your agreement.
Leasing is easier to get approved so if you have bad credit, it may be an option to get
the equipment you need while your credit rebuilds. The process is quick and easy. At the
end of the lease, the business may purchase the equipment for its fair market value (or a
fixed or predetermined amount), continue leasing, lease new equipment or return it.
HOW DOES IT WORK?
Typically, lease terms are long term, from three to five years with interest rates from 6%
to 16%. The leases are offered by the manufacturers or by third party vendors. Make sure
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