What Factors Are Used To Determine Creditworthiness?
- Length of time in business
- Financial condition
- References
- D & B or other credit bureau ratings
What About Sales Tax?
Sales tax will be invoiced to the customer for the appropriate sales tax on a monthly basis with their monthly payments. Quoted lease payments do not included sales tax.
How Are Leasing Charges Determined?
The monthly payment is based on the term of the lease, cost of the equipment, and the credit of the lessee. Standard terms of a lease runs from 12 to 60 months. Special structures available.
Who Can Lease?
Any company, organization or association. Innovative Capital will not lease equipment to an individual for personal use.
Leasing vs. Going To The Bank
Banks in most cases ask for a complete updated financial package when applying for equipment purchase loans while many leases can be obtained with a one page application.
Banks do not particularly like equipment loans because they have to loan on your business cash flow not the value of the equipment. Leasing companies however, are only in the business of financing equipment. Banks file what is called a “blanket lien” on all of your business assets including your checking account, in some cases personal assets. In the event of default your entire business is taken by the bank (all of your assets, inventory, equipment, accounts, etc.) With a lease, a “single lien” is filed on the leased equipment only. In the event of default, the equipment solely is repossessed.
Does Innovative Capital Warrant or Service the Equipment?
No. We strictly provide the financing. It is no different than if you purchased the equipment because the lessor assigns the warranty to the lessee. The lessor disclaims and assigns its warranties and other rights against the manufacturer or vendor to the lessee. In addition, the lessee waives its right to assert any claims or defenses against the lessor for any problems, because the lessee chose the equipment.
The Most Common Misconception About Leasing:
LEASING IS TOO EXPENSIVE
It really depends on how you look at it. If you’re cash rich and only look at the total payments of the lease, then this statement is true. But if you look at the overall benefit of the leasing vs purchase then this statement is not as convincing. It all comes down to how smart you manage your money. The first thing you need to know is that money is not made by the ownership of equipment; it is made by the use of it. You’ll probably have the equipment for three to ten years and then replace it with updated similar equipment. If you own it then your investment has been depreciating all this time and you will have had to put down the required 20-30% down payment. A lease allows you to use money that is not tied up in this depreciating asset for investments that appreciate or increase (i.e house). The smart thing to do, is to invest the money that would normally be used for a down payment, as in the purchase of the equipment, in an appreciating asset. Another important point regarding overall cost is that a lease locked into today’s lower rates protects against fluctuating prices often associated with traditional bank financing. You can also preserve your line of credit at the bank because your payments are handled through another funding source and it doesn’t take a rocket scientist to know that lines of credit are increasingly difficult to extend.
How Do I Get A Lease From Innovative Capital Corp.?
Obtaining leasing through us is simple. Just click on contact us to reach us or simply apply now online. Our procedures are as easy as 1-2-3. For a step by step outline of what happens next click here.
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