Equipment Leasing Programs - True Lease

A True Lease which is also known as a fair market value (FMV) lease provides the most standard type of lease agreement. This type of lease structure will offer you the lowest monthly payment for new/used or sale leaseback leases. In some cases, your business can claim the lease payment as a tax deduction. This lease structure will allow you many options at the end of the lease. Such options are:

• Purchasing the equipment at the current fair market value

• Upgrading to new equipment

• Renewing the lease

• Returning the equipment

Equipment Leasing Programs - Finance Lease

Unlike an Operating Lease (see previous post) a finance lease is a form of leasing where you, the lessor, pay the full cost of the equipment, plus interest, over the primary term of the lease agreement. Monthly payments are determined during the lease structuring process and represent the full value of the equipment.

Key points of finance leasing:

• The value of the asset (equipment being leased) is shown on your balance sheet
• This lease structure is typically not used if rapid tax benefits are desired.
• Opportunity to own the equipment at the end of the lease is more advantageous being that the equipment can be purchased for a minimal cost.

Equipment Leasing Programs - Operating Lease

Our previous post contained examples of typical leasing programs. As with any other financial transaction, you need to be certain that the structure of your lease should match your business goals and cash flow requirements.

One of the most common types of leasing is an operating lease. What is an operating lease and what can it do for me and our company? Well, let's look at the basics.

Operating leases are a form of off-balance sheet financing that provides the option to continually upgrade or replace your current equipment without the worry of ownership. End of lease options allow you to return the equipment so that technological obsolescence is avoided. You will find that an operating lease will have a lower monthly payment than other lease / finance alternatives.

Equipment Leasing Programs

Now that we’ve taken a look at the basics of equipment leasing, end of lease options and whether it’s right to choose leasing or buying your equipment, let’s take a look at the many different ways to structure your equipment lease. Programs range from the typical Operating Lease to more industry specific and/or specialized leases. As an example, core programs offered by eLease International are shown below:

* Operating Leases

* $1 Out Leases

* Federal & Municipal Leases & Financing

* Sale/Leaseback Leasing & Financing

* Venture Capital Leasing & Financing

* Country Cross Border Leases

* Capital Leases

* Direct Finance Leases

* Full Service Leases

* Receivable Factoring

* Tax Oriented Leases

* Business Lines of Credit

Be certain to partner with the right financial company. Your equipment lease should always be creatively structured and specifically tailored to your company’s needs.