A finance lease is a hybrid option which sits between an operating lease and hire purchase. In a finance lease arrangement, you are in complete control of the procurement process, so you select the manufacturer / supplier you prefer, you agree with them the exact specification of the goods that you need and when you’ve agreed this we purchase the asset. You will then have exclusive use of the item for the period of the initial agreement.
Over the course of the finance lease contract you will make fixed rental payments to us which typically total the original purchase price of the item in question, including any borrowing fees due to us. At the end of the initial lease agreement there will be a number of options available to you:
- If you still need the asset, we can agree an extension, known as a ‘secondary’ / lease arrangement, the value of the monthly fees is likely to be considerably lower than your original payments.
- If, however, you no longer want the asset you can simply return it to us or we can mutually arrange for the disposal of the asset to an independent third party at market value – the proceeds of which will be shared with you as agreed at the outset.
Finance leasing helps you access the new or used specific items, software, plant, machinery, products or vehicles you need to run your business with a low initial outlay and spread the cost over a defined and affordable period. You do not have the issues with ownership, but you have all the benefits of usage and flexibility to continue that usage if so required.
Finance leasing is just one of the options we use to help our clients acquire the right tools to help them grow their business and improve their cash flow. If you would like to know more or have a specific purchase you would like to discuss with us, please contact a member of our team today.