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Leasing Industrial Equipment vs. Bank Financing
Leasing industrial equipment – More than ever, successful businesses are turning to equipment leasing as a way of maximizing their financial leverage. Here are just some of the reasons why:
- Payments tailored to your cash flow patterns. With step-up, step-down, seasonally adjusted, skip payment, and other payment stream options, leasing can meet your company’s unique needs and requirements
- No obsolescence concerns. At lease end, you have the option to return the equipment if you no longer need it or want to upgrade
- Fixed payments. Lease payments are typically fixed for the entire term of the agreement. There are no surprises as with conventional bank loans, which are generally tied to the movement of the prime rate
- No cross collateralization. Banks often require that you pledge other collateral. They do this by filing blanket liens that effectively tie up all of your equipment and assets, not just the equipment you are acquiring, thus severley compromising your future financial flexibility
- Longer term and lower payments. Equipment can often be leased for a considerably longer period of time than conventional bank financing, affording a lower monthly outflow of cash