Which type of Asset Finance is best for me?
Here at Busby Finance, we have 4 different types of Asset Finance that all come with their own benefits. Which one is right for you is dependent on your business’s financial situation and requirements, but it’s also important to understand what’s included with each option to choose the best one for you. To help you decide, we’ve created a quick overview of what’s involved within each of them.
This is a great option for new companies or those who have limited access to cashflow. In this instance, the lender will purchase an asset the borrower requires, on their behalf. An agreement will be set up for fixed, monthly repayments that the borrower will make over a period of time. Although the borrower will be able to use the asset throughout the agreement, it’s owned by the lender until the full payment has been made.
Equipment Lease
A popular choice for businesses who require a particular piece of equipment to effectively provide their product or service. This could include transport to make deliveries, new technology to keep up to date with invoices and payments, or urgently replacing large appliances that have unexpectedly broken down.
Equipment leasing involves the lender purchasing the necessary asset and the borrower hiring it from them. During this period, although the lender has ownership of the asset, the borrower is responsible for its maintenance. Once the agreed term comes to an end, the borrower can return the asset, extend the lease or buy it from the lender.
This is a mix of Hire Purchase and Equipment Leasing but focuses on the period of time that the asset is used by the borrower rather than its full lifespan. For example, some industries require big pieces of transport or machinery that can be costly to purchase outright, and in many cases are only needed for a certain period of time. By opting for a Finance Lease, the borrower is only paying for the amount of time the asset is in use, making this a viable option for businesses using equipment for short or medium-term needs.
If your business is already well established and has valuable assets, you can apply for Asset Refinance and use these existing resources as collateral. These usually include things such as vehicles, premises or equipment, and allows the borrower to release cash against the item which can then be used elsewhere.
The purpose of Asset Finance is to help businesses get hold of the resources they need, when they need them, in order to grow their business. If you think one of the options above will help you get to the next step, then please get in touch. Our friendly and experienced team are here to discuss all your options.
