The new buzzword in the industry is “lease”. Lease is merely a contract signed by two parties for the use of an asset whether it is tangible or intangible. It has become very popular as it incorporates both operational and financial considerations. Another important reason for getting into a lease option is the flexibility it gives in acquiring the equipment and in business expansion.
Let us see what options are open while considering lease so that you can choose the one that suits your requirements. Because of the flexibility and variety of options you can customize it into a tailor-made lease.
- Deposit Options
When considering the deposit you have the following options to choose from:
- Simple Deposit
This is the least costly and most affordable form of deposit as the deposit given applies immediately to the first and the last payment.
- Traditional security deposit
This type of deposit is held until the expiration of the term and returned after the completion of the transaction/ contractual deed. Generally, it is 10% of the value and forfeited in case of non-fulfillment of contractual deed.
- Payment Options
You can select from the following payment options:
- Deferred Payment
This payment is made after a specified time, generally 30 to 90 days from the commencement of the lease. This allows the leaseholder to generate revenue and makes it convenient for cash flow.
- Seasonal Payment
These payments are made according to the seasonal schedule when the business is in peak. This allows the lessee to maintain the equilibrium in the business.
- Step Payment
With step payments the amount is increased or decreased depending upon the equipment usage at specified intervals as per the contract deed.
- Level Payment
The payments are made in equal proportion until the expiry of the lease. Long term expenditure is fixed, hence you have a greater control over finance.
- Lease Terms
Lease terms allow you to decide about the period for which you require the equipment. They are usually in the range of 12 to 72 months and they allow you to plan out your strategy. The longer the term, the lesser the monthly payments and lesser the tax savings benefits and vice versa.
- Term-end options
When the term expires, you have the following options to choose from:
- Re-lease
Once the lease terms ends, you can give back the old equipment and re-lease new equipment with the same terms by following the same application process.
- Renew the lease
If you wish to continue with the same equipment, you can just apply to renew the lease with a new period specified in the contract or until your requirement is fulfilled.
- Purchase the equipment
The third option is to purchase the equipment at the end of lease period as specified in the contract.
- Return and Cancel
If you do not wish to either purchase or renew the lease, you can simply discontinue the lease after the expiry of the lease period.
Every business requirement has specific needs. You can visit gotruckcapital.comfor the right lease you are looking for, with options that fit your pocket.