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Asset Lease

Fincred CF is a broker that can find asset lease solutions for your business.

What is an asset lease and how can it help you? Find out the simple answers below.

What Is An Asset Lease?

With an asset lease your business is able to borrow the asset for a fixed period in exchange for a monthly payment. 

Because your business never has to make a large upfront payment for the asset, you avoid a detrimental impact to your cash flow. 

What are the Different Types of Asset Leasing?

There are two main specific types of asset lease:

  1. Operating Lease
  2. Finance Lease 

Depending on what type of asset lease you choose, there are differences in the following:

  • How the payments are recorded in your accounting system
  • Who is considered the “owner” of the asset
  • Whether the asset can later be purchased permanently
  • Who is responsible for the maintenance of the asset
  • Who is responsible for the insurance of the asset

Asset leases can be used to purchase different types of items. For example: equipment leases or plant/machinery leases.

What Business Items is an Asset Lease Usually Used For?

Industries as varied as construction, manufacturing, transport and logistics, and more will use asset leasing to acquire the expensive equipment needed to run their business. Asset leasing is also common for items like office photocopiers or company cars.

What are the Benefits of Leasing an Asset Instead of Purchasing it Outright?

As you might expect, a lease is ideal when the equipment is only needed temporarily. For example, a construction company may take on a contract expected to last a period of one year. Any equipment that is only needed for that contract would be ideally acquired through a one-year lease.

This is not the only situation where a lease is desirable, though. Taking on a lease instead of a purchase allows you to use expensive equipment while spreading out the costs, and may leave a third party responsible for the maintenance and insurance. 

Alternatives to Asset Leasing

Instead of renting an asset through a lease, you may want to explore a hire purchase agreement, or an asset finance plan which will be preferable if you want to own the asset.

Which option is best for you depends on your circumstances. You should ask yourself questions like:

  • What is your cash flow situation?
  • What is the asset/equipment you are looking at?
  • How will it be used in your business?

Different options for purchasing or leasing an asset will impact your accounting. It is best to discuss this with your accountant. 

You should consider all the options available to you. That is why it is a good idea to talk to a broker with expertise in the areas of leasing and finance like Fincred CF. 

Work with Fincred, Your Asset Leasing Partner

It can be difficult to know which asset leasing option is right for your business. As an experienced broker in the area of asset leasing (and finance), FinCred CF will help guide you through the process and answer any questions you may have.

Asset leasing doesn’t have to be difficult. Find out what we can do for you today by getting in touch.

We work in partnership with our sister company FinCred IS, an expert in surety bonding and trade credit insurance. Which are able to offer policies which can complement and facilitate your asset lease agreement.

UK Wide Industry Statistics

Total value off all sales financed in the UK - £bn

Domestic invoice discounting - £bn

Total number of asset based lending clients

Domestic invoice discounting clients

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