When you’re looking to finance equipment necessary to run your business, you’ll either have to purchase it outright or lease it from a leasing company. Most business owners lack the cash to buy large equipment simply from cash reserves, so they are obliged to either acquire a loan to pay for the equipment or to lease it monthly. When you are investigating the leasing process, it will be to your advantage to read the fine print and find out exactly what the equipment is going to cost you every month.
The Cost of Leasing
There are always a certain number of small businesses which have no choice but to default on their leases, usually as a result of a significant downturn in business. Whenever a leasing company has to absorb losses like this, they have to be passed on to new customers in the form of higher leasing rates. Therefore, when you’re about to sign up for equipment leasing, make sure you have a thorough understanding of all the actual costs which you will be incurring.
If your business has a low credit score, you might still be able to secure equipment financing with no problem. However, the chances are that you’re going to have to pay a significantly higher lease amount than any other small business with good credit would pay. In some cases, you might even be paying twice the amount that a small business with good credit pays for the same equipment you’re leasing. These facts should give you pause to consider and should make it apparent to you that it’s necessary to know exactly what you’re signing up for when you embark on equipment leasing.
Looking to Finance Your Business Equipment?
If so, we may be able to assist with the necessary financing. Contact us at Jasema Capital so we can discuss some options which may be available to you.