Whether you lease a car to get into the latest models or have better purchasing flexibility, getting a good deal is always bound to give you a lift. Use these guidelines to help you spot one:
Check incentives: be on the look-out for factory –subsidized lease deals. Car manufacturers realise that consumers who lease vehicles from them are more likely to be repeat customers than those who simply purchase vehicles. Through their leasing companies, they adjust the residual value and offer low financing charge. Other auto-manufacturers are also starting to give incentives on leasing, called leasing subventions. They offer these subsidies to put slow-selling models on the street, saving you even more money.Set up a competitive: bidding environment to get the lowest price. If you already have an idea in mind of the make, model and trim level of your desired car, attempt to calculate your own lease payment before you go shopping to avoid paying through the roof. Check online comparison tools or use a lease calculator to check your lease payment based on purchase price. This gives you greater negotiation leverage as you solicit quotes from various leasing companies.Make sure you know all the fees involved at the beginning of your lease: you may have to pay fees for licenses, registration and title. Other fees include acquisition fees, freight fees and local or state taxes. At lease-end, you may have to pay a disposition fee and charges for extra mileage and any excess wear.
Be aware that some of these fees – like acquisition and disposition fees – are negotiable.
Know your mileage needs: almost all leases limit the number of miles per year by imposing typically 10 to 20 cents per excess mile over 15,000 milesa year. If you are the kind of high-commuter who puts 40,000 miles a year on his car, then you might end up running thousands of dollars in hefty penalties at the end of your lease. Be smart and negotiate a higher-mileagelimit or pad you excess miles at the beginning of your lease to avoid robber tax rates for excess miles. Almost all leases limit the number of miles per year by imposing fees typically 10 to 20 cents per mile over 15,000 miles per year.
If you are the kind of high-commuter who puts a lot miles on his car, then these costscan add up quickly. Negotiate Include GAP coverage: make sure your lease includes GAP coverage. This covers you in the event of the vehicle getting wrecked, stolen or totalled. Without GAP insurance, you leave yourself wide open to thousands of dollars in leased obligations. Check if the GAP coverage is included so you don’t pay it twice.
Thursday, March 5, 2009
Lease Trading.
Ever wanted to terminate your lease early, comfortable with the thought youweren’t going to be hit with hefty fees? You can if you transfer your lease to someone else.
Trading a lease is the best option for people who want to terminate a lease early and don’t want to pay the large termination imposed by most lease agents. It can also be an alternative to get out of a lease for far less than you would otherwise pay your original lease company for extra mileage and wear-and-tear charges that can run into the thousands of dollars. For a small fee, you can advertise your car lease for assumption to a large number of potential buyers on the look-out for leases on the Internet. Suchservices include LeaseTrader.com, the originator of online lease-trading and the biggest online marketplace where most lease transfers take place, and smaller marketplaces such as BreakAlead.com and TradeAlease.com.
Before swapping your lease, make sure your leasing company approves lease transfer transactions. Caution must be exercised in choosing a lease swapping service: make sure they facilitate the whole lease transfer process, offer online or telephone customer-service help and registered buyers undergo stringent credit checks.
Trading a lease is the best option for people who want to terminate a lease early and don’t want to pay the large termination imposed by most lease agents. It can also be an alternative to get out of a lease for far less than you would otherwise pay your original lease company for extra mileage and wear-and-tear charges that can run into the thousands of dollars. For a small fee, you can advertise your car lease for assumption to a large number of potential buyers on the look-out for leases on the Internet. Suchservices include LeaseTrader.com, the originator of online lease-trading and the biggest online marketplace where most lease transfers take place, and smaller marketplaces such as BreakAlead.com and TradeAlease.com.
Before swapping your lease, make sure your leasing company approves lease transfer transactions. Caution must be exercised in choosing a lease swapping service: make sure they facilitate the whole lease transfer process, offer online or telephone customer-service help and registered buyers undergo stringent credit checks.
If You Cannot Afford New Cars Then Try Car Leasing.
As the credit crunch further looms over everybody's head, people start panicking and the added worry comes when there car breaks down. No one can afford to pay for repairs, especially if they are still paying off a finance or loan agreement. The answer for all your concerns is the option of car leasing.
Leasing not only relieves you from the stresses and strains that owning a car can bring, but it also gives you the option of driving better cars, then you could ever practically afford to buy. Car leasing has become very popular over the recent years, mainly being due to how inexpensive leasing can actually turn out to be, particularly for the short term. Obviously if you are thinking about long term, then buying would probably be a better option.
You can choose to take a lease out for any amount of time that you may wish, a few companies do offer the choice of a massive discount if you decide to lease a car over a long period of time. What is so great about car leasing is that you do not have to worry about the vehicle breaking down; the leasing company will take care of all of the faults and replace it with a car that is in perfect working order.But before you run into get a car leasing deal, you should firstly load yourself up with as much knowledge as you can. There are tons of online leasing companies these days and there are also a handful of price comparison sites.
So you have the choice of either manually going through and finding the best deal, or alternatively using one of the comparison websites to get the best deal. You should decide which vehicle you would like to lease out, and how long you would like the lease to be in affect.The great thing about car leasing is that if you get into financial trouble and can no longer afford the monthly repayments, you can always negotiate a settlement plan to suit your needs and maybe extend the lease further.
Leasing is a great alternative to buying, but you must remember to take care of the vehicle, as the company expects to receive the vehicle back with only normal wear and tear. Car leasing should definitely be considered as you may even be allowed to fully purchase the vehicle once your term has been completed.
Leasing not only relieves you from the stresses and strains that owning a car can bring, but it also gives you the option of driving better cars, then you could ever practically afford to buy. Car leasing has become very popular over the recent years, mainly being due to how inexpensive leasing can actually turn out to be, particularly for the short term. Obviously if you are thinking about long term, then buying would probably be a better option.
You can choose to take a lease out for any amount of time that you may wish, a few companies do offer the choice of a massive discount if you decide to lease a car over a long period of time. What is so great about car leasing is that you do not have to worry about the vehicle breaking down; the leasing company will take care of all of the faults and replace it with a car that is in perfect working order.But before you run into get a car leasing deal, you should firstly load yourself up with as much knowledge as you can. There are tons of online leasing companies these days and there are also a handful of price comparison sites.
So you have the choice of either manually going through and finding the best deal, or alternatively using one of the comparison websites to get the best deal. You should decide which vehicle you would like to lease out, and how long you would like the lease to be in affect.The great thing about car leasing is that if you get into financial trouble and can no longer afford the monthly repayments, you can always negotiate a settlement plan to suit your needs and maybe extend the lease further.
Leasing is a great alternative to buying, but you must remember to take care of the vehicle, as the company expects to receive the vehicle back with only normal wear and tear. Car leasing should definitely be considered as you may even be allowed to fully purchase the vehicle once your term has been completed.
Easing Out the Burden of Car Lease
One of the probable burdens under a car lease is the time span by which you should be under a certain contract or scheme. Before deciding to go under an agreement, you may want to list down some possible preferences by which you could undertake a lease contract.
As a consumer, the decision-making process lies in your hands and once you have come up with your choice, there is definitely no turning back. You may want to get a handful of information on the take over car lease concept.Accessibility of making leases. Undergoing a car lease agreement is no longer as tedious as before. You need not worry a lot as there are opportunities for you in the web. You could consult online experts and staff in order to get all the necessary data you want before considering the scheme.
The plans include a wide variety of choices like lease assumptions and lease trading. These concepts are down lines of the take over car lease program.Early termination of contract is now allowed. Long before the take over car lease concept came into reality, people find it hard to undergo a negotiation especially that there is a contract that would bind the parties. The burden also comes alongside the fact that you need to go for a long period by which you should have a car before handing it back again to the lessors. Nowadays, however, ending up your commitment early is possible under the new car lease concept.Experts will answer your predicaments. Gone are the times when your contractors will leave you just hanging after they have done a deal with you. Under the present situation, a car lease does not end upon signing of the contract. The responsibility extends to both the company and the consumer. This way is more convenient for both parties as certain terms and conditions may be discussed. There are online experts who will surely make your take over car lease a ride to remember.Release from the commitment is always possible. If you are having emergencies and you think getting rid of your car lease will be one of the answers, you need not worry about your duties as a lessee. When you undergo the take over car lease agreement, you are ascertained that you are totally free from any obligation. All you have to do is to find someone out there, who is a consumer yourself and is willing to undergo a short-term lease plan.Bear in mind that a take over car lease settlement is just like having a symbiotic relationship.
While your company does bulk of the work for you, you also have to do your part. This means that if you want total freedom from any understanding, you have to work hand-in-hand with your lessor. There will come a time that you will need a car lease again and the proper option is to go to someone with whom you have built confidence and trust.
As a consumer, the decision-making process lies in your hands and once you have come up with your choice, there is definitely no turning back. You may want to get a handful of information on the take over car lease concept.Accessibility of making leases. Undergoing a car lease agreement is no longer as tedious as before. You need not worry a lot as there are opportunities for you in the web. You could consult online experts and staff in order to get all the necessary data you want before considering the scheme.
The plans include a wide variety of choices like lease assumptions and lease trading. These concepts are down lines of the take over car lease program.Early termination of contract is now allowed. Long before the take over car lease concept came into reality, people find it hard to undergo a negotiation especially that there is a contract that would bind the parties. The burden also comes alongside the fact that you need to go for a long period by which you should have a car before handing it back again to the lessors. Nowadays, however, ending up your commitment early is possible under the new car lease concept.Experts will answer your predicaments. Gone are the times when your contractors will leave you just hanging after they have done a deal with you. Under the present situation, a car lease does not end upon signing of the contract. The responsibility extends to both the company and the consumer. This way is more convenient for both parties as certain terms and conditions may be discussed. There are online experts who will surely make your take over car lease a ride to remember.Release from the commitment is always possible. If you are having emergencies and you think getting rid of your car lease will be one of the answers, you need not worry about your duties as a lessee. When you undergo the take over car lease agreement, you are ascertained that you are totally free from any obligation. All you have to do is to find someone out there, who is a consumer yourself and is willing to undergo a short-term lease plan.Bear in mind that a take over car lease settlement is just like having a symbiotic relationship.
While your company does bulk of the work for you, you also have to do your part. This means that if you want total freedom from any understanding, you have to work hand-in-hand with your lessor. There will come a time that you will need a car lease again and the proper option is to go to someone with whom you have built confidence and trust.
Get Out of Car Lease Immediately
A lot of people undergo car leases to have the benefit of using more than one car under a specified period of time. We must accept that it is innate in all of us to get out of car lease immediately in order to have another. Emergencies may also get in the way and giving up luxury over necessity is one of the quick fixes offered.
You need not worry about penalties for early termination of the contract as there are a lot of opportunities under a short car lease.Exiting your auto lease immediately.
Whatever your reasons may be, inform the company of your financial problems and you will surely have yourself relieved from the crisis you are undergoing. The short car lease will never oblige you to have the burden. You are given the chance to undergo a short-term program that will never get you out of the responsibility to provide for your daily needs. Get out of car lease is a scheme that will always give you the chance to live outside any obligation.Communicate with other car lessees. A short car lease gives you the chance to open links with other patrons. There are people out there who are more willing to go for rents at a minimum period of time, the way you do. Looking for online consumers who have the same predicaments like you is one way to get out of car lease immediately.
You need not worry about having an obligation. Short car lease provides you the opportunity to walk around with your head held high. You are guaranteed to have no responsibility at all. Get out of car lease provides you the chance to live normally without creditors or companies running after you. Being out of the rental agreement will not affect your credit standing at all.You are assured to have savings from your money. While you favor to have a short car lease, you will surely get your money’s worth. Under the agreement, you may want to undergo lease assumptions. This means that you need not go for a new agreement. You may opt to assume the lease of another person who underwent a swap a lease plan. When you undergo this scheme, you will surely get out of car lease coinciding with your time estimate.Not because you go for a short car lease, you will be given low end cars.
You still have the opportunity to go for the top of the line options in the market. You are not prohibited to give yourself the experience you are craving for when it comes to your driving experience. The get out of car lease concept is not made to make consumers discriminated. It is just a form of giving you the ease you want should you have emergencies in the long run. Your capacity as the lessee will never be questioned. You will be provided with a lot of suggestions alongside your car rental.
You need not worry about penalties for early termination of the contract as there are a lot of opportunities under a short car lease.Exiting your auto lease immediately.
Whatever your reasons may be, inform the company of your financial problems and you will surely have yourself relieved from the crisis you are undergoing. The short car lease will never oblige you to have the burden. You are given the chance to undergo a short-term program that will never get you out of the responsibility to provide for your daily needs. Get out of car lease is a scheme that will always give you the chance to live outside any obligation.Communicate with other car lessees. A short car lease gives you the chance to open links with other patrons. There are people out there who are more willing to go for rents at a minimum period of time, the way you do. Looking for online consumers who have the same predicaments like you is one way to get out of car lease immediately.
You need not worry about having an obligation. Short car lease provides you the opportunity to walk around with your head held high. You are guaranteed to have no responsibility at all. Get out of car lease provides you the chance to live normally without creditors or companies running after you. Being out of the rental agreement will not affect your credit standing at all.You are assured to have savings from your money. While you favor to have a short car lease, you will surely get your money’s worth. Under the agreement, you may want to undergo lease assumptions. This means that you need not go for a new agreement. You may opt to assume the lease of another person who underwent a swap a lease plan. When you undergo this scheme, you will surely get out of car lease coinciding with your time estimate.Not because you go for a short car lease, you will be given low end cars.
You still have the opportunity to go for the top of the line options in the market. You are not prohibited to give yourself the experience you are craving for when it comes to your driving experience. The get out of car lease concept is not made to make consumers discriminated. It is just a form of giving you the ease you want should you have emergencies in the long run. Your capacity as the lessee will never be questioned. You will be provided with a lot of suggestions alongside your car rental.
Car Leasing: Pros and Cons
The process of hiring a car for a specified period of time and a fixed mileage is called car leasing. UK has a whole lot of Car leasing companies. These companies provide new as well as used cars for hiring. The customer has to pay the lease amount as monthly installment to the company. Budget may be the main factor that refrains one from using one’s favorite car. But the main advantage of car leasing is that it will take you out of the budget limitation hassles. Your budget is likely to be the main factor that prevents you from using your favorite car. Car leasing thus helps you realize your long cherished dream. There are different lease options such as personal lease for personal use, and business lease, which is VAT recoverable for business use. Also, there are options to purchase the car after the lease period. Now about the things to be considered in mind while taking a car on lease… The lease period is usually 18, 24, 36 or 48 months. A wide range of different model cars would be there with the car leasing companies. It is always advisable to take a car with good residual value at the end of the lease period. Thoroughly and carefully consider all the clauses in the car leasing agreement before getting into one. There would be penalties for early settling of lease and extra mileage used. The wear and tear that occurs during the lease period and any modifications done during the period should be borne by the hirer. So it’s very important to study the lease agreement put forward by different companies. Always make it a point to choose the one that best suits your budget. Thus, car leasing is an option that lets you have your favorite car with minimum budget and minimum risk. The hirer, if cautious in selecting a suitable company with a suitable offer most ideal for his needs, would be having the highest satisfaction of motoring on the roads of UK.
Beneficial Lease Option Tips
Lease option tips benefit the seller and the buyer in an equal manner. They help in creating a finance required for the transaction of a home deal. The lease option permits the tenant to buy the concerned property within a time period of 12 to 24 months.
Lease options are a good source for purchasing homes for the first timers of home buying who have not qualified for the finance options. They give the buyer's time for getting their finances in shape for purchasing the property. The lease options are also great marketing tools for the sellers of properties for finding good buyers. The sellers can place advertisements in the newspapers, or contact the offices of Corporate Relocation specialist for helping them find the buyers of lease options. The mortgage bankers can also help in this process. The internet can also be useful for finding the buyers.
Benefits of the Lease Options:There are various benefits for the buyers as well as the sellers of the lease options. The lease option tips for the buyers are listed below..The tenants get the facility of paying a small amount upfront for the house. This amount is smaller than the normal down payments.The possibility of a monthly credit rent helps in generating the down payment, resulting in a savings account for the buyers.The buyers can enjoy the benefits of living in the house that they dreamt of now instead of renting an apartment and waiting to repair their credit.But, this convenience is not available without costs. An option fee needs to be paid by the buyers, in addition to any potential rent credits and the monthly rent. The seller can keep this money if the buyer is not able to work out the option.The lease option tips for the sellers are as follows:This option increases the monthly flow of cash for the sellers.This also helps in solidifying the cost of the property before the selling date. This rate of solidifying is good in the real estate market.
The lease option prompts the tenants in taking care of the property, as they have the intention of buying it in the future..The sellers receive money upfront and can retain it if the tenant fails to exercise the option.The contracts of the lease options are sometimes very complex in nature. The tips of lease options suggest that the language of the contract has to focus on the contract terms, rather than the price. The finding of buyers for the lease option, demands a considerable amount of time investment on part of the sellers.But the lease option tips are an encouragement for the sellers to investigate the markets thoroughly for predicting the appreciation of the property's value in the future. Hence, it is recommended that the sellers invest time in forecasting the price of selling along with the search for prospective buyers of the lease option.
Laws of the state have also to be investigated for ensuring abidance with the regulations for the mechanism of the lease options.
Lease options are a good source for purchasing homes for the first timers of home buying who have not qualified for the finance options. They give the buyer's time for getting their finances in shape for purchasing the property. The lease options are also great marketing tools for the sellers of properties for finding good buyers. The sellers can place advertisements in the newspapers, or contact the offices of Corporate Relocation specialist for helping them find the buyers of lease options. The mortgage bankers can also help in this process. The internet can also be useful for finding the buyers.
Benefits of the Lease Options:There are various benefits for the buyers as well as the sellers of the lease options. The lease option tips for the buyers are listed below..The tenants get the facility of paying a small amount upfront for the house. This amount is smaller than the normal down payments.The possibility of a monthly credit rent helps in generating the down payment, resulting in a savings account for the buyers.The buyers can enjoy the benefits of living in the house that they dreamt of now instead of renting an apartment and waiting to repair their credit.But, this convenience is not available without costs. An option fee needs to be paid by the buyers, in addition to any potential rent credits and the monthly rent. The seller can keep this money if the buyer is not able to work out the option.The lease option tips for the sellers are as follows:This option increases the monthly flow of cash for the sellers.This also helps in solidifying the cost of the property before the selling date. This rate of solidifying is good in the real estate market.
The lease option prompts the tenants in taking care of the property, as they have the intention of buying it in the future..The sellers receive money upfront and can retain it if the tenant fails to exercise the option.The contracts of the lease options are sometimes very complex in nature. The tips of lease options suggest that the language of the contract has to focus on the contract terms, rather than the price. The finding of buyers for the lease option, demands a considerable amount of time investment on part of the sellers.But the lease option tips are an encouragement for the sellers to investigate the markets thoroughly for predicting the appreciation of the property's value in the future. Hence, it is recommended that the sellers invest time in forecasting the price of selling along with the search for prospective buyers of the lease option.
Laws of the state have also to be investigated for ensuring abidance with the regulations for the mechanism of the lease options.
Real Estate Investing and Lease Options
You can pursue various options, once you enter the real estate market. You can either flip your properties and book your profits or you can lease out your property. If you decide to lease out your property, then again you have a choice of encashing your profits at later date. Read on to gain an insight into real estate investing and lease options.If the house that you have purchased does not appreciate enough for you to sell it immediately, then you could encourage your tenant to enter into a lease option. In such an agreement, the tenant will have the option to buy your property at the end of the lease term, which could normally be around one to three years. The purchase price of the property could be decided at the time of entering into the lease option agreement or at the end of the lease period. However, most tenants would rather decide on the price of the property at the time of entering into the agreement itself. Once your tenant agrees to the purchase price, and then he/she will have to give you a non-refundable deposit that you can retain, in case the tenant backtracks on the agreement to purchase the property at the determined time.This agreement also binds you and you cannot sell your property to anyone else during the lease period. However, you can compensate for this clause by asking for a higher rental during the lease period. The tenant-turned-buyer has an option of selling your property to a third party during the lease period, subject to your approval. The optional deposit is not considered as a down payment for your property, though the rentals can be considered as installments against the value of the property. One advantage that you have is that your tenant would take good care of your property, since in the future, he/she would turn into actual owners of that property. Another advantage is that the option money, which the tenant deposits with you, would be forfeited, if the tenant fails to purchase the house at the end of the lease period. In case the tenant is unable to arrange the rest of the money at the end of the lease period, it will also become easier for you to evict the tenant. The tenant too has several advantages to enter into a lease option agreement. If the tenant's credit history is poor and he/she does not qualify for a regular mortgage, then this type of an agreement can enable him/her to purchase a property at a future date. Your tenant also would not have to pay a substantial amount as down payment, which otherwise would have to be paid in case of a mortgage. The tenant also has the option not to buy the home at the end of the lease period, if the rest of the money does not materialize, although he/she would have to lick the wounds of losing the option money. It is necessary to hire a worthwhile real estate attorney, who can explain the finer nuances of the lease option agreement and can keep your end safe, in case of any problem during or after the expiry of the lease period. A lease option is a good alternative to dispose your property at the current, subdued rates and can enhance your real estate investment at a future date.
Real Estate Investing and Lease Options
You can pursue various options, once you enter the real estate market. You can either flip your properties and book your profits or you can lease out your property. If you decide to lease out your property, then again you have a choice of encashing your profits at later date. Read on to gain an insight into real estate investing and lease options.If the house that you have purchased does not appreciate enough for you to sell it immediately, then you could encourage your tenant to enter into a lease option. In such an agreement, the tenant will have the option to buy your property at the end of the lease term, which could normally be around one to three years. The purchase price of the property could be decided at the time of entering into the lease option agreement or at the end of the lease period. However, most tenants would rather decide on the price of the property at the time of entering into the agreement itself. Once your tenant agrees to the purchase price, and then he/she will have to give you a non-refundable deposit that you can retain, in case the tenant backtracks on the agreement to purchase the property at the determined time.This agreement also binds you and you cannot sell your property to anyone else during the lease period. However, you can compensate for this clause by asking for a higher rental during the lease period. The tenant-turned-buyer has an option of selling your property to a third party during the lease period, subject to your approval. The optional deposit is not considered as a down payment for your property, though the rentals can be considered as installments against the value of the property. One advantage that you have is that your tenant would take good care of your property, since in the future, he/she would turn into actual owners of that property. Another advantage is that the option money, which the tenant deposits with you, would be forfeited, if the tenant fails to purchase the house at the end of the lease period. In case the tenant is unable to arrange the rest of the money at the end of the lease period, it will also become easier for you to evict the tenant. The tenant too has several advantages to enter into a lease option agreement. If the tenant's credit history is poor and he/she does not qualify for a regular mortgage, then this type of an agreement can enable him/her to purchase a property at a future date. Your tenant also would not have to pay a substantial amount as down payment, which otherwise would have to be paid in case of a mortgage. The tenant also has the option not to buy the home at the end of the lease period, if the rest of the money does not materialize, although he/she would have to lick the wounds of losing the option money. It is necessary to hire a worthwhile real estate attorney, who can explain the finer nuances of the lease option agreement and can keep your end safe, in case of any problem during or after the expiry of the lease period. A lease option is a good alternative to dispose your property at the current, subdued rates and can enhance your real estate investment at a future date.
Picking Rental Lease Agreements That are Right for Your Property
Before you jump in and ink your rental lease agreements, it's crucial that you know the different types of tenancy for landlords. Find out how to pick your perfect rental lease agreement today.1. Periodic Tenancy - If You Need to End Your Lease on Short NoticeAs the name suggests, a periodic tenancy comes in a few flavours: week to week, month to month or year to year. When it comes to periodic leases, week to week and month and month tenancies are highly popular with residential landlords.As a periodic tenancy does not have a specific ending date, your lease is renewed on a weekly or monthly basis. This particular feature is both the benefit and drawback of having a periodic lease.This makes it much easier for you to end your rental agreement if necessary. Depending on your local real estate laws, you will usually just have to give your tenant a written notice to quit 30 to 60 days in advance. However your tenant can end your lease agreement just as easily so you will end up suffering from lost rent if you can't find a new tenant in time.If you are thinking of selling or re-renting your rental property to another person in the near future, then a periodic tenancy is recommended because you will have the freedom to end it when needed.Periodic leases are also a good idea if you need more time to screen and observe your new tenants before deciding to lock him in as your long term tenant.2. Fixed Term Lease - If You are Looking for Stable Long Term Rent PaymentsFixed term tenancies have an official start and end date - You are not allowed to end your rental lease agreements before they expire unless your tenant agrees to it as well (known as a surrender of tenancy).The only way you can end your fixed term tenancy prematurely is when you have a strong reason to evict your tenant. If your tenant does not pay you rent or breaks the terms of your lease, then you can file for a court order to remove him.In exchange for being tied down during your lease period, your tenant cannot choose to leave anytime he wishes without your consent. If he leaves without your permission, he will still have to pay you rent until you can find a new tenant to replace him.That's why fixed term tenancy are recommended for landlords who are looking for stable rental income in the long run. If you have a pleasant and reliable tenant, you may also want to choose a fixed term lease as an effective way of keeping him.3. Tenancy at Will - Renting Your Property without Formal PaperworkIf you need a quick and easy way to rent out your rental property, then tenancy at will may be the short cut that you are looking for.Tenancy at will is usually a verbal rental lease agreement although you can have an informal note with the terms and conditions of your lease. This type of rental lease agreements is also very easy to end - You can simply inform your tenant verbally 30 days in advance.If you are only planning to have very short term tenants or you are renting to someone you can absolutely trust, then a tenancy at will may be good enough for you. Another valid reason for having a tenancy at will is to use it as a temporary solution until you are ready to have a formal written rental contract with your tenant.
Your Free Residential Lease Agreement Guide for Landlords
Are you looking for a free residential lease agreement for your rental property? Then learn these important landlord tips for making sure that you have an effective and iron clad rental lease. So what are the necessary ingredients for a good free residential lease agreement?1. The Type and Duration of Your LeaseThere are 2 major types of lease and your rental agreement must clearly state which type of tenancy you have: periodic tenancy or fixed term tenancy. For residential tenants, most periodic leases will be either week to week or month or month. In general, periodic leases are preferred by landlords who want a shorter term tenancy or one that can be ended more easilyIf you have a fixed term tenancy, a proper free residential lease agreement must state the exact starting and ending date. The time period of a fixed term lease is usually 6 months or more.2. How You will Handle Your Tenant's Security DepositYour residential lease agreement should clearly state how much security deposit you will be collecting. Most residential landlords will collect security deposits that is equal to 1 to 2 months of rent.To prevent any possible protests by your tenant, your lease agreement should also state when you can deduct money from their security deposit. Common reasons for deposit deductions include non-payment of rent and repair bills for property damages.3. How Rent is Collected and Fees for Late Rent PaymentsFor a landlord there is nothing more important than your rent. If you have a free residential lease agreement, make sure that your rent amount and collection method (e.g. cash, checks or online) is clearly stated on it.If you are imposing fees for late rent payments, you have to state how much and under what conditions you will collecting it from your tenant. Most areas will restrict the maximum amount of late fees you are allowed to charge so make sure that your fees are not over limit.4. Who will be Paying for the Different Property ExpensesWhile the law will usually decide who pays for some types of bills (for example the landlord has to pay for property maintenance), other expenses such as electricity, water and waste disposal bills have to be clearly stated on your written rental agreement.5. How Your Residential Lease Agreement Can be EndedHow your lease will end depend heavily on what type of tenancy you have. If you have a periodic lease, your agreement has to clearly state how many days in advance your tenant has to inform you before leaving. The landlord tenant law in most areas requires you to give a written notice to quit at least 30 days in advance.Your free residential lease agreement should also include the rules and regulation of your tenancy. If your tenant breaks the rules, you will be allowed to evict him according to your local landlord laws.
Net Lease Investments
The fascination of “No Management” has bombarded the Sunshine State
Triple Net Lease Investments, the phenomenon that allows a landlord to defer all of the owners’ traditional responsibilities to a tenant, has taken over as an investment of choice for both private investors and institutional buyers. By having all management/maintenance, taxes and insurance, (hence the three (3) nets) taken away from a landlord’s daily tasks and given directly to the tenant to handle, allows for the most passive form of real estate investment for a sole owner in today’s market. Most net lease assets fall into a few categories; office, industrial or retail buildings.
Retail transactions make up the bulk of net lease investments. The drug store on the corner, restaurants along the busy street and bank branches in front of the new supermarket are all some of the most popular investments. But exactly what is one purchasing when the decision is made to become a passive real estate investor? With net leased properties, three considerations, in this specific order, must be analyzed before an investment is procured; the intrinsic value of the real estate, the tenant’s credit and the lease terms. First, the real estate or the location of the property. We cannot forget that we are still investing in real estate. The cliché adage of "location, location, location" does not go away just because there is income attached to a property. Even large, public companies go out of business. We've seen many examples in recent years. Therefore, we have to understand the value of the property without a tenant and the feasibility of attaining a new tenant if the current rent-payer decides to leave at any point. Next, the actual tenant that is in place for a particular property may dictate the value of that property. The difference between a high Standard & Poors (S&P) rated company as a tenant and a local "Mom and Pop" operator is usually vast. Meaning the probability that the S&P rated company defaulting on their lease is lower and therefore a landlord can be more assured of receiving their rent from that tenant for a longer period. Conversely, if the Mom and Pop operator had a couple of bad months, they could close indefinitely. Lastly, the terms of the lease are important to an investor. The most sought after leases are absolutely passive to the landlord where, in most cases, they receive a wire transfer from the tenant each month and never so much as receive a phone call about the property. There are many variations on net leases, but those with the most passivity garner the lowest returns because there is little to no work involved for the landlord. Blending the three aforementioned attributes is the most specific means in determining the value of a property.
When buyers and sellers are determining the specific value of their net lease investment, they typical use capitalization rates, or cap rates. Simply dividing the net rent into the purchase price will determine a yield for the investor. The higher the cap rate the lower the price but the perceived risk for the property is higher and vice versa. Over the past several years, cap rates have dropped significantly given the fact that several driving forces were at all time highs, or lows, depending on how you look at them. For instance, interest rates were very low allowing prices to increase due to the availability of debt. Additionally, cap rates were affected by the influx of investors completing 1031 exchanges. While people were selling their properties for record prices, they were motivated to not pay their long-term capital gains taxes and use the IRS code to purchase another property. With a tremendous amount of investors using the tax code to their benefit, all at the same time, the demand for passive, income producing properties (net lease investments) increased dramatically. Now, Real Capital Analytics recently reported that all retail cap rates have been gradually increasing since the third quarter of 2007 by roughly 25 basis points. Additionally, of the five major Florida markets; Jacksonville, Miami, Orlando, Palm Beach and Tampa, industrial property activity remained somewhat flat over the last several months. Office property pricing dropped slightly in the last three quarters, increasing cap rates to levels not seen for the last eighteen months. While volume is down for all three asset classes, there has not been a drastic change in pricing since the alteration of the debt markets.
For the last several years, brokers who focus their practices strictly on net lease properties have had some banner results. However, now that the market is tightening, sellers are flocking to their trusted sources for honest and frank information on today’s market perceptions. The real estate professional that has a fiduciary duty to their client is now sought out by many sophisticated and savvy owners. It is fiscally irresponsible for a developer or investor to pursue a property if they don’t have a clear and quantifiable exit strategy. Those that are in the market everyday and focus on net lease investments are a sought after commodity because “the tide will no longer float every boat.” Realistic assumptions need to be made for the seller who is investing in this market. Buyers are also seeking the advice of specialized brokers who see opportunity in the market and want representation from an expert. Having a broker who is committed to sorting through the varied options in today’s market will only benefit the buyer to show them the overall advantages of one property over another. This is especially helpful with buyer’s completing 1031 exchanges in the aggressive timing parameters.
Overall, the Florida net lease investment market has shown significantly strong signs of maintaining its vibrancy. When investors and debt sources begin to take a closer look at each investment, the investors usually go back to tried and true philosophies. Florida is seen as a market that is still attracting a growing population and developers will need to support that growth by accommodating tenants with office, industrial and retail buildings. In today’s market, tremendous value is being placed on the assets that are in more dense areas with strong tenancy and long, passive leases. Markets that were once seen as speculative or “in the path of growth” are now not in the forefront of investors’ minds, but still remain an interest for future investment. We must also not forget that a large percentage of investors benefit from the Florida’s lack of state income tax. Investments in the state will always get more interest due to that one simple fact.
Triple Net Lease Investments, the phenomenon that allows a landlord to defer all of the owners’ traditional responsibilities to a tenant, has taken over as an investment of choice for both private investors and institutional buyers. By having all management/maintenance, taxes and insurance, (hence the three (3) nets) taken away from a landlord’s daily tasks and given directly to the tenant to handle, allows for the most passive form of real estate investment for a sole owner in today’s market. Most net lease assets fall into a few categories; office, industrial or retail buildings.
Retail transactions make up the bulk of net lease investments. The drug store on the corner, restaurants along the busy street and bank branches in front of the new supermarket are all some of the most popular investments. But exactly what is one purchasing when the decision is made to become a passive real estate investor? With net leased properties, three considerations, in this specific order, must be analyzed before an investment is procured; the intrinsic value of the real estate, the tenant’s credit and the lease terms. First, the real estate or the location of the property. We cannot forget that we are still investing in real estate. The cliché adage of "location, location, location" does not go away just because there is income attached to a property. Even large, public companies go out of business. We've seen many examples in recent years. Therefore, we have to understand the value of the property without a tenant and the feasibility of attaining a new tenant if the current rent-payer decides to leave at any point. Next, the actual tenant that is in place for a particular property may dictate the value of that property. The difference between a high Standard & Poors (S&P) rated company as a tenant and a local "Mom and Pop" operator is usually vast. Meaning the probability that the S&P rated company defaulting on their lease is lower and therefore a landlord can be more assured of receiving their rent from that tenant for a longer period. Conversely, if the Mom and Pop operator had a couple of bad months, they could close indefinitely. Lastly, the terms of the lease are important to an investor. The most sought after leases are absolutely passive to the landlord where, in most cases, they receive a wire transfer from the tenant each month and never so much as receive a phone call about the property. There are many variations on net leases, but those with the most passivity garner the lowest returns because there is little to no work involved for the landlord. Blending the three aforementioned attributes is the most specific means in determining the value of a property.
When buyers and sellers are determining the specific value of their net lease investment, they typical use capitalization rates, or cap rates. Simply dividing the net rent into the purchase price will determine a yield for the investor. The higher the cap rate the lower the price but the perceived risk for the property is higher and vice versa. Over the past several years, cap rates have dropped significantly given the fact that several driving forces were at all time highs, or lows, depending on how you look at them. For instance, interest rates were very low allowing prices to increase due to the availability of debt. Additionally, cap rates were affected by the influx of investors completing 1031 exchanges. While people were selling their properties for record prices, they were motivated to not pay their long-term capital gains taxes and use the IRS code to purchase another property. With a tremendous amount of investors using the tax code to their benefit, all at the same time, the demand for passive, income producing properties (net lease investments) increased dramatically. Now, Real Capital Analytics recently reported that all retail cap rates have been gradually increasing since the third quarter of 2007 by roughly 25 basis points. Additionally, of the five major Florida markets; Jacksonville, Miami, Orlando, Palm Beach and Tampa, industrial property activity remained somewhat flat over the last several months. Office property pricing dropped slightly in the last three quarters, increasing cap rates to levels not seen for the last eighteen months. While volume is down for all three asset classes, there has not been a drastic change in pricing since the alteration of the debt markets.
For the last several years, brokers who focus their practices strictly on net lease properties have had some banner results. However, now that the market is tightening, sellers are flocking to their trusted sources for honest and frank information on today’s market perceptions. The real estate professional that has a fiduciary duty to their client is now sought out by many sophisticated and savvy owners. It is fiscally irresponsible for a developer or investor to pursue a property if they don’t have a clear and quantifiable exit strategy. Those that are in the market everyday and focus on net lease investments are a sought after commodity because “the tide will no longer float every boat.” Realistic assumptions need to be made for the seller who is investing in this market. Buyers are also seeking the advice of specialized brokers who see opportunity in the market and want representation from an expert. Having a broker who is committed to sorting through the varied options in today’s market will only benefit the buyer to show them the overall advantages of one property over another. This is especially helpful with buyer’s completing 1031 exchanges in the aggressive timing parameters.
Overall, the Florida net lease investment market has shown significantly strong signs of maintaining its vibrancy. When investors and debt sources begin to take a closer look at each investment, the investors usually go back to tried and true philosophies. Florida is seen as a market that is still attracting a growing population and developers will need to support that growth by accommodating tenants with office, industrial and retail buildings. In today’s market, tremendous value is being placed on the assets that are in more dense areas with strong tenancy and long, passive leases. Markets that were once seen as speculative or “in the path of growth” are now not in the forefront of investors’ minds, but still remain an interest for future investment. We must also not forget that a large percentage of investors benefit from the Florida’s lack of state income tax. Investments in the state will always get more interest due to that one simple fact.
Hunting Lease Agreements - Tips To Understand Them Better
When the season opens and you intend to take a game property on lease for hunting, you need to fully understand the terms of the lease before you sign the papers. Property owners in game woods though find it rewarding to lease for hunting, they are also becoming increasingly concerned about damages to their property. Besides, they also run risks of a lawsuit if somebody was badly hurt or killed in their property.Alabama Hunting Lease - What Are Alabama Hunting Lease Agreements?Any lease is a contract, the terms of which are agreed by both the parties when signing. While you start your search for a property to lease for your hunting season, you need to keep in mind that these leases are legal documents, and you have to comply with the terms no matter what. This also means that this document can be enforced in a Court of Law in the event of any dispute.The Alabama hunting lease agreements essentially contain;• The names of the owner of the property and the lessee (the person, or a group of persons, taking the property on lease)• The period for which the lease is valid. During this period the lessee is fully responsible for the property, as per the terms of the lease.• Lease charges• Stipulations for damages to property - extent of damages and compensation• Indemnity for the owner in case there are damages to lifeAlabama Lease Agreements For Hunting - What To Do?If you are looking for a property to lease, and you are confronted with an agreement by an owner, you need to bear the following things in mind;• First, this contract is a legal document enforceable in a court of law.• Second, the terms vary with the owners, and what they want to put in the agreements. Even the same owner may have different terms for each season.• Third, this is for the protection of the owner and his property. If you are confident on your responsibility and believe that you are a good sportsman, then you should be viewing the agreement with a positive attitude.• Fourth, if any clause seems excessive in demand or not very clear to you, you had best refer it to the owner for more information before signing.Most hunting lease agreements in Alabama are reasonable and do not pose any difficulties if your own conduct is good enough. But once you sign them, you are in the contract and have to comply with the terms. If you are group of people, then one responsible person can sign the contract and assume full responsibility for the group. Before you do this be sure about your control over the group of people.Importantly, for anything in doubt DO NOT hesitate to ask the owner for clarification.
New Lease Car Buying Guide
What is Car Leasing?Many people are choosing to buy their new car on lease agreements nowadays.
This gives you the chance to own a brand new car without the upfront costs of buying a vehicle outright, as you would typically do at a car dealer.There are many types of car leasing agreements.Why buy a new car on a leasing scheme? The main reason is that you can spread your payments over a fixed term but start driving your new car straight away. Maintenance charges can also be kept to a minimum depending on the service schedule.Buying your new lease car on the InternetBuying over the Internet protects the buyer under the Distance Selling Act. When buying from a car leasing website make sure that the company displays their full contact details such as phone number, fax number and full address (not a P.O. box).
The Internet is a very useful tool for comparing prices from different companies, all in the comfort of your own home.When looking at new lease car prices on the Internet make sure there are no hidden extras and whether VAT is inclusive or exclusive. If necessary call and speak to a representative and ask as many questions as you like if you are not happy with the answers move on to the next one.New Lease Car - Advantages and DisadvantagesProsFull manufacturers warrantyBetter safety featuresOwning a brand new vehicleYour choice of colour and specificationAccident free and mechanically soundLatest featuresLow initial paymentEasy options at the end of the deal (you don't have to sell the vehicle, either hand back or trade in against a new car leasing deal)ConsCost is higher than a used modelDepreciation of vehicle is high initiallyInsurance could be higher for a new carEarly termination can be costlyCan be costly if you go over the annual mileage agreement.Must return the car in good condition or penalties will applyReasons not to lease a car.
If you are not sure how long you will need a car or you may be getting a company car in the near futureNot cannot guarantee that you can meet the monthly payments or have a regularincomeYou have a high annual mileageYou do not look after your carsYou do not like to be in debt or owing moneyGMC Leasing is an independent car leasing company specialising in personal and business contract hire. We also arrange all other types of finance including finance lease, lease purchase, hire purchase and cash sales. We can finance any make on model new or used
This gives you the chance to own a brand new car without the upfront costs of buying a vehicle outright, as you would typically do at a car dealer.There are many types of car leasing agreements.Why buy a new car on a leasing scheme? The main reason is that you can spread your payments over a fixed term but start driving your new car straight away. Maintenance charges can also be kept to a minimum depending on the service schedule.Buying your new lease car on the InternetBuying over the Internet protects the buyer under the Distance Selling Act. When buying from a car leasing website make sure that the company displays their full contact details such as phone number, fax number and full address (not a P.O. box).
The Internet is a very useful tool for comparing prices from different companies, all in the comfort of your own home.When looking at new lease car prices on the Internet make sure there are no hidden extras and whether VAT is inclusive or exclusive. If necessary call and speak to a representative and ask as many questions as you like if you are not happy with the answers move on to the next one.New Lease Car - Advantages and DisadvantagesProsFull manufacturers warrantyBetter safety featuresOwning a brand new vehicleYour choice of colour and specificationAccident free and mechanically soundLatest featuresLow initial paymentEasy options at the end of the deal (you don't have to sell the vehicle, either hand back or trade in against a new car leasing deal)ConsCost is higher than a used modelDepreciation of vehicle is high initiallyInsurance could be higher for a new carEarly termination can be costlyCan be costly if you go over the annual mileage agreement.Must return the car in good condition or penalties will applyReasons not to lease a car.
If you are not sure how long you will need a car or you may be getting a company car in the near futureNot cannot guarantee that you can meet the monthly payments or have a regularincomeYou have a high annual mileageYou do not look after your carsYou do not like to be in debt or owing moneyGMC Leasing is an independent car leasing company specialising in personal and business contract hire. We also arrange all other types of finance including finance lease, lease purchase, hire purchase and cash sales. We can finance any make on model new or used
How to Get the Best Deal on a New Car Lease
Since you are reading this, I am going to assume that you are looking into the lease options for your next new car instead of purchase options. A new car lease MAY be a good deal for you but it is something that you should examine very carefully, since you may end up in a much worse position.On the up side, a new car lease is almost certainly going to have lower monthly payments that a purchase, compared with the same amount of money out of pocket at the time of signing. You can usually get a good deal on a car lease for less than a couple thousand out of pocket. The monthly payment is going to be determined by what the estimated resale value of the car will be at the end of the lease. So a car with poor resale value is going to have higher monthly payments than a car with a much better average resale value. But on the down side, you are still responsible for the maintenance of your leased car – gas, oil changes, tires, tune-ups, insurance, and all the other things that normally accompany car ownership, but you are NOT building any equity in the car. In other words, you are in effect RENTING the car, except that you also have the responsibility for the maintenance of it.Not all new car leases are created equally. You should definitely do your homework as far as what leasing programs are available, what they include and exclude, and most of all, what is it going to cost you. One big thing in almost all car leases is a mileage cap, where a typically mileage cap says that you will put no more than 12,000 miles a year on the car. So at the end of a three year lease, you can have no more than 36,000 miles on the car. You do not get any extra brownie points if there are fewer miles on it, but if there are MORE miles than that on it, you will pay through the nose for it, something like 30 cents per mile. So in this example, at the end of the lease you have 40,000 miles on it, it is going to cost you an additional $1200 to turn in the car. Ouch!Over the course of a lease, you may want to terminate the lease early. If this might even be a remote possibility, know what your options are up front. In most cases, there is an early termination fee. Sometimes if you leased your car from a large dealership, they will allow an early termination fee without penalty if you are within about 6 months of the end of the lease, but only if you sign another agreement on another new car lease.I would strongly encourage you to do a fair amount of homework before you sign on the dotted line. Even if the lease being offered by the dealership on your new car lease appears to be incredibly good, you can almost always be assured that there is a better program available. Sometimes the payments might be the same, but other programs may allow a higher mileage cap, might have lower or no early termination fees, and a variety of other subtle differences that could make a huge difference to you and your intended use of the new car.
Leasing Gives Providers a Way to Acquire Medical Equipment
Leasing gives the healthcare provider the opportunity to enjoy the exponential growth rate of medical equipment technology. The medical community may now offer diagnoses based on information about a patient's condition that we couldn't accurately obtain using older equipment. The problem is that most organization's capital budgets just can't keep pace with the quickening of technology advances.The problem is getting worseIf you're like most medical care providers, you are facing the dilemma of how to provide cutting-edge care to your patients but don't have the financial reserves (cash or credit) to make the purchase of new equipment. One could argue that it is economics that slows down the delivery of medical care. Standard accounting practices allow for the assets to be depreciated over five years. What do you do when the equipment needs to be replaced in some amount of time less than five years? One option is to try selling the outdated equipment on eBay or somewhere else in the open market.There is a better solutionThere is another option that many astute organizations use. They simply lease the equipment. Why lease? It's all about cash flow. Typical leasing standards require you to put just two payments down in cash. In addition, an operating lease will allow you to write 100% of the cost of the equipment as expense on your firm's income statement. By treating the asset as an operating expense you don't have to deal with depreciation on the leased medical equipment. Plus the lease does not show up on your credit report, possibly freeing you to make other necessary purchases.Is leasing for you?While most organizations need to be in business for at least 3 years, savvy shoppers can find leasing companies that have no time-in-business requirements. Even without documenting your financial statements, you should be able to enter into leases up to $150,000. By providing a bit of financial information, you can lease items with a much higher dollar figure.Does this sound like a viable option?Typical lease terms are two to five years, and are affected by the typical useful life of the item you are leasing for your business. Some leasing companies have the flexibility to buy back newly acquired equipment assets and convert them into leases. Do you normally pay shipping, installation, training and other soft costs on top of the actually hardware? You can search out leasing companies that will include these items in the lease. Have a lease with unfavorable terms? Most do not know it, but you can actually refinance leases into one with more favorable terms. Be wary, however, of expensive penalties that may be outlined in the lease agreement.If you're strapped for cash, or just want to conserve it for other business purposes, leasing will enable you to obtain a much needed piece of business (medical or otherwise) equipment without a large outlay of cash.
Staff Leasing is the Best Option
Are you a marketer or a business owner who wants to increase the productivity of your business? Staff leasing is the best option for you.Staff leasing is the secret behind the success of the businesses nowadays. For a business to grow and be progressive, its marketers and business owners need help to make it possible. A person or a group of people that will help your business to grow is hard to find but with staff leasing, you don’t need to worry it all. A staff leasing company will give you the time you need to focus with your business goals. Why resort to staff leasing? 1. Low Cost. Staff leasing can surely saves you money. It’s achieving your business needs at low rates. You pay $1200 for your local designer, when you can already get a dedicated webmaster with that amount. ManageStaffing™ offers regular webmaster that works 6 days a week. Start counting the savings that you can using our cost effective staff leasing. Start the switch, start staff leasing with ManageStaffing™.2. Skillful Employees. Staff leasing companies provide you with trained employees that will give you all the business solutions that you need. They are flexible and willing to work anytime at your advantage.3. High Quality Service. Since staffs are of great knowledge of their expertise, high quality service is assured to be given to its clients. All the tasks will be executed properly with the specific time frames.4. No-Hassle in Employees Management. No need to worry about supervising your employees. Staff leasing will be responsible with the employees to ensure a good working relationship with you and handle all the workplace matters. 5. Focus in your Business. Through the help of a staff leasing company, focusing in your business will be easy for you. This will give you time to fully give your attention in expanding your business.The progress of your business doesn’t just depend on you, you can’t do it alone. If you want to attain a successful business that will guarantee you commitment and quality, ManageStaffing™ is the right staff leasing company for you!ManageStaffing™ is a staff leasing company that offers a variety of skills that suit your business needs. With our value-added, technology-supported solutions, we can help your company increase business productivity at low rates. We are located at the world’s favorite back office operations site – Makati, Philippines. With ManageStaffing™, communication is not a problem because we are proficient in English that we can deliver product input conveniently. Today’s technological advancements such as instant messaging, emailing, and even video conferencing will enable us to be in touch whenever and wherever you may be. Our team: Creative Writers, Graphic Designers, Multimedia Artists, Programmers, Systems Administrators, Virtual Assistants, Webmasters, Web Designers, Web Designers – are entirely consists of educated and proficient degree holders in their respective areas of expertise setting us apart from other staff leasing firms in the market. They are formally learned and trained further to assure a world class quality of work. You can choose from our various individuals and their specialized skills in our staff database, and view their profiles and sample work to asses who you want to lease. You can have direct communication with your staff to relay instructions and information clearly. Compared to other staff leasing suppliers, direct communication is prohibited and may impede project growth. You can choose from our two detailed solutions made for every business problem – the Dedicated Staff Package and Per Project Package.With a Dedicated Staff package, a staff is leased exclusively to you to do routine or maintenance-type tasks. Per Project Package is a one-time project that has to be accomplished in a given time and budget. Giving us the needed material is important for the groundwork of our project planning and implementation. We will bring you give you satisfaction and guarantees you privacy in every partnership made. With ManageStaffing™, you can experience great service, smooth and easy communication, and achieve end-product excellence.
An Introduction to Leasing and Asset Finance
Confused by the types of finance available to your business? Want to expand your operations but don't have the liquid capital available to invest in things like equipment? If so a leasing agreement could be right for your business.How does it work?Essentially all leasing agreements work on the principle of renting an asset from a third party, usually a financial institution, for a fixed period. This type of contract is typically referred to as a lease.Leasing plays a big part in the property market where properties are leased out to tenants. However leasing is also a popular way to finance business growth or deal with financial difficulties.Typically the lease agreement will work as follows;- A business requires a new asset (for example a factory needs an expensive new machine)- The factory reaches an agreement with a lessor- The lessor buys the new machine from its seller- The lessor rents the machine out to the factory for a fixed term as defined in the lease agreement i.e. 2 years. - At the end of the lease term the factory either returns the machine or renews the contract with the lessor.Why use leasing as a form of finance?Leasing improves cash flow for companies as expensive outgoings like purchasing equipment are offset by the lessor and the company only pays a rental fee. Although this fee will typically be more than the relative cost of purchasing the asset outright, the cost is spread over manageable rental instalments.Unlike a loan many lease agreements are not regarded as a debt but as an expense. This is more favourable to a business entering other credit agreements where the stronger a credit position the business is in the more eligible they will be for preferential rates and higher lending.As an asset is not owned by the business but by the lessor the residual cost of owning aging assets such as machinery are offset. This means a business can upgrade once an asset reaches obsolescence without the cost involved with selling or disposing of the aging asset. This is most effective in cases such as IT equipment leasing where technology companies want to stay up to date with their IT infrastructure without the continual cost of degrading IT kit.Problems with leasingAs mentioned, leasing can be an expensive way to raise finance, often more than other routes including loans and always more expensive than buying an asset for cash as the lessor themselves need to make their own profit.Lease contracts will often tie businesses into a fixed term meaning if circumstances change the business will still need to keep up lease payments.As when leasing the business does not own the asset, when valuing a company, for example during a buy-out or merger their will be less material assets to base a valuation on.Is leasing the right finance option for my business?Our best advice is to consult financial specialists prior to entering any lease transactions.
Expand Your Business with Vendor Equipment Leasing
Many equipment vendors don't want to bother with financing. They figure that the customers who can afford equipment will buy and that those that can't won't. It is correct that customers on tight budgets who can't afford the equipment outright aren't going to buy. That doesn't mean they aren't potential business opportunities. Many of these customers are leasing equipment instead of buying. If you don't have a leasing program, you could be losing quite a bit of your business to your competitors that do offer leasing programs. Equipment Leasing vs. BuyingAccording to recent surveys, only 22% of businesses buy their equipment outright while the rest finance the purchase. Less than 50% of that equipment financing is done through loans. Most equipment is acquired through leasing programs.Particularly for the small business, equipment leasing offers substantial benefits over purchase such as tax benefits and easy upgrades. It requires less capital up front so is often the only option for cash-strapped and credit-poor companies.For the vendor, equipment leasing means a much wider customer base. You can offer your products to companies you never considered before. Additionally, a lease can often mean more income over the long run than selling a piece of equipment outright. Leasing is an operating expense rather than a capital expense, so can be approved at a lower level of the organization. This means quicker turnaround on the deal.Leasing Brokers do the Dirty WorkIf you are like the typical vendor, equipment leasing isn't something you have experience with. You know how to design and manufacture the product but you probably don't have anyone on staff that is well versed in the details of financing. This means hiring a new person and maybe even creating a new department, along with all the bureaucratic headaches that come along with such a restructuring.Instead of doing the equipment leasing yourself, go through a broker. Brokers handle all the picky details of matching you to the right customer, checking customer credit, finding funding sources, and setting up the lease agreements. This lets you focus on what you do best without diluting your efforts.Leasing Income Means Regular Cash FlowAnother advantage of equipment leasing is that rather than occasional and unpredictable sales income, you now have a regular, monthly income stream. This makes it easier to plan your future finances and cover regular expenses.Leasing lets customers upgrade equipment more frequently, and that is good for your business as well. Rather than waiting for the old equipment to die, you can sign customers to new leases on updated, and usually more expensive, equipment and increase your cash flow.Implementing a vendor equipment leasing program brings your company an array of potential new customers and predictable income. Doing it through a broker means the program will have very little impact on your actual day-to-day operation except for the increased sales opportunities. Leasing is an increasingly popular option and there is no reason for any equipment vendor not to offer a financing program to their customers.
Taking the Mystery Out of Software Financing and Software Leasing
The very terms “software leasing” and “software financing” are confusing to many businesspeople. This is due to the fact that software is typically not seen as something that is purchased over time.This view is shared by both end-users, and the developers of software. Companies who think nothing of financing a vehicle or a new computer system will stress over how they will pay for expensive new business software. And the producers of software see no need for offering a software leasing or a software financing option.But times are changing.Third party equipment finance companies - companies who offer small and medium size businesses equipment financing and working capital – have responded to a need for software financing and software leasing. Thus, they are starting to include software amongst the equipment they finance or lease. There is one big overriding reason for this shift:The High Cost of Buying SoftwareThe simple fact is this: Software can be very, very expensive. Oftentimes more expensive than the hardware that runs it.Now, keep in mind that when we are talking about software in this way, we are generally talking about “vertical software”. Vertical software is software that is written for a specific, narrow industry (this can include industry-specific point-of-sale software, ERP systems, specialized databases, etc). It is not software that’s available on the shelf at your local office supply store (the software you see there, even the business programs and operating systems, are “horizontal software” – they can be used across a variety of industries, and are relatively affordable.)A good, clear example of vertical software is an auto parts store - they use software that’s specifically written for the auto parts industry. Another example is your local jewelry retailer – they likely use a point-of-sale system specifically made for the jewelry industry. To understand how software financing and software leasing can positively affect a business, it is important to understand the advantages of vertical software first. For most businesses, Vertical Software usually means far more efficient business processes. In the case of an auto parts store, for example, the software will already anticipate the thousands of automobile makes and models. And will almost certainly be updated every year. The jewelry store’s software will differentiate the subtle differences between two diamonds by any number of categories. And so on. In fact, these “vertical” software programs are so effective, and become so crucial to day-to-day operations, that businesses often need this type of software to remain competitive. In many cases, it’s not an option to do without.However, since the software is so narrowly focused, it usually comes with a hefty price tag. The developer will sell relatively few copies as opposed to a word processing program (which will sell in the millions), so they must get a premium for their work. Vertical software can sometimes reach five figures for a single license. This brings an obvious problem: “Businesses need the software, but it’s very costly to buy outright.”And that’s where software leasing and software financing come in – business don’t have to “buy” it upfront. The Advantage of Software Leasing and Software FinancingThe advantage of financing or leasing software is clear: Software leasing and software financing take the huge up-front cost of new software out of the equation. Like most other business equipment, software is now beginning to be seen as a tangible asset (this was not always the case.) This means software can largely be treated as any other equipment purchase in the case of financing or leasing. A business can finance that new ERP system instead of having to budget a huge cash outlay. This can be very beneficial to the bottom line, as software generally pays for itself over time. In fact, since “vertical” software almost always reduces the cost of doing day-to-day business, leasing or financing said software can actually create a positive cash flow right away.But Who Offers Software Financing or Software Leasing, and how does it Work?It’s true that software developers have been very slow to embrace the business model of software financing or software leasing. They would prefer to be paid up front for their software. Likewise, banks, being part of an “older” industry, are also largely reluctant to finance software. However, third party equipment finance companies who specialize in small and medium sized business equipment financing often offer attractive software lease and software financing packages. What happens is the equipment finance company pays the developer in full, and then provides the software to the end user under a finance or lease agreement, often at very attractive rates. In all actuality, it’s fundamentally the same as financing or leasing most other equipment.Of course, like any other financing, the agreements can (and will) vary from traditional fixed rate financing to a “software lease” with a buyout at the end, etc. And the rates and terms also vary – your individual equipment finance company will have more details.All in all, software financing and software leasing have definitely entered the business consciousness, and because it is so friendly to the bottom line, it is a business model that is here to stay. Software leasing and Software financing are only a few of the services provided by Crest Capital. Regardless of the size of your company, Crest Capital can provide you with the equipment financing and working capital you need to successfully grow your business. Learn about financing options that can increase your bottom line and reduce your 2007 tax bill with a free online quote today.
Taking the Mystery Out of Software Financing and Software Leasing
The very terms "software leasing" and "software financing" are confusing to many businesspeople. This is due to the fact that software is typically not seen as something that is purchased over time.This view is shared by both end-users, and the developers of software. Companies who think nothing of financing a vehicle or a new computer system will stress over how they will pay for expensive new business software. And the producers of software see no need for offering a software leasing or a software financing option.But times are changing.Third party equipment finance companies - companies who offer small and medium size businesses equipment financing and working capital - have responded to a need for software financing and software leasing. Thus, they are starting to include software amongst the equipment they finance or lease. There is one big overriding reason for this shift:The High Cost of Buying SoftwareThe simple fact is this: Software can be very, very expensive. Oftentimes more expensive than the hardware that runs it.Now, keep in mind that when we are talking about software in this way, we are generally talking about "vertical software". Vertical software is software that is written for a specific, narrow industry (this can include industry-specific point-of-sale software, ERP systems, specialized databases, etc). It is not software that's available on the shelf at your local office supply store (the software you see there, even the business programs and operating systems, are "horizontal software" - they can be used across a variety of industries, and are relatively affordable.)A good, clear example of vertical software is an auto parts store - they use software that's specifically written for the auto parts industry. Another example is your local jewelry retailer - they likely use a point-of-sale system specifically made for the jewelry industry.To understand how software financing and software leasing can positively affect a business, it is important to understand the advantages of vertical software first.For most businesses, Vertical Software usually means far more efficient business processes. In the case of an auto parts store, for example, the software will already anticipate the thousands of automobile makes and models. And will almost certainly be updated every year. The jewelry store's software will differentiate the subtle differences between two diamonds by any number of categories. And so on.In fact, these "vertical" software programs are so effective, and become so crucial to day-to-day operations, that businesses often need this type of software to remain competitive. In many cases, it's not an option to do without.However, since the software is so narrowly focused, it usually comes with a hefty price tag. The developer will sell relatively few copies as opposed to a word processing program (which will sell in the millions), so they must get a premium for their work. Vertical software can sometimes reach five figures for a single license.This brings an obvious problem: "Businesses need the software, but it's very costly to buy outright."And that's where software leasing and software financing come in - business don't have to "buy" it upfront.The Advantage of Software Leasing and Software FinancingThe advantage of financing or leasing software is clear:Software leasing and software financing take the huge up-front cost of new software out of the equation. Like most other business equipment, software is now beginning to be seen as a tangible asset (this was not always the case.) This means software can largely be treated as any other equipment purchase in the case of financing or leasing. A business can finance that new ERP system instead of having to budget a huge cash outlay.This can be very beneficial to the bottom line, as software generally pays for itself over time. In fact, since "vertical" software almost always reduces the cost of doing day-to-day business, leasing or financing said software can actually create a positive cash flow right away.But Who Offers Software Financing or Software Leasing, and how does it Work?It's true that software developers have been very slow to embrace the business model of software financing or software leasing. They would prefer to be paid up front for their software.Likewise, banks, being part of an "older" industry, are also largely reluctant to finance software.However, third party equipment finance companies who specialize in small and medium sized business equipment financing often offer attractive software lease and software financing packages. What happens is the equipment finance company pays the developer in full, and then provides the software to the end user under a finance or lease agreement, often at very attractive rates. In all actuality, it's fundamentally the same as financing or leasing most other equipment.Of course, like any other financing, the agreements can (and will) vary from traditional fixed rate financing to a "software lease" with a buyout at the end, etc. And the rates and terms also vary - your individual equipment finance company will have more details.All in all, software financing and software leasing have definitely entered the business consciousness, and because it is so friendly to the bottom line, it is a business model that is here to stay.
Tuesday, March 3, 2009
Disadvantages and Advantages of Van Leasing With Used Vans
One of the concerns in business operation is to provide vehicles for operational use. The businesses that needs vehicles may choose to get a vehicle by outright purchase or through leasing. The former is like buying a vehicle in cash or in installment arrangements and the intention is to fully own the vehicle while the latter is leasing arrangement where the vehicle company still owns the vehicle but is offered to the client as leased item. The client then pays a deposit and leasing fee in a regular basis. Usually the arrangement of lease is flexible with the customer’s paying capacity. Each model or brand of vans has leasing price. What matters is that you don’t need to raise high capital for vehicle purchase. With van leasing, you just need to raise required deposit and ensure that you get regular earnings to compensate the leasing fees to be paid regularly.
The major disadvantage of van leasing is that you have no ownership of the vehicle. As such, you are most likely subject to conditions and terms of usage for the vans. In cases of breakdowns, you are obliged with policies governing breakdown cause by one of your business operations. Despite your effort and money put into the repair, you still don’t own the vehicle. Second disadvantage is that you get to lease used vans. Used vans may not be in good driving condition anymore so it would be detrimental to your business operations.
However, the advantage of van leasing outweighs the disadvantages. First, your payment option is flexible with your terms. Whilst owning brand new vans for your business requires big capital, you can be have a vehicles and be operational already with van leasing. You don’t have to wait until you get big amount to buy vehicles for the business since van leasing only requires deposits and leasing fee paid on a regular basis. There are also arrangements with van leasing companies that suit your current capacity to pay. Second advantage is that van leasing may be using used vans, but these are refurbished models that are definitely useable to new clients. Van leasing companies usually provide used vans to clients since these are vehicles that have previously been leased by other clients. The remodeling of the used vans makes it look like the new user is getting brand new vans for lease. Different models, brands, and sizes of vans has different leasing price so there is definitely one that suits the needs for your business. If your business is into stocks delivery for example, you can find vans that match the distance of your commercial deliveries, the capacity of the stocks usually carried in the van, and the period that you want to use the van for such a routine. Third advantage is that since you don’t own it, you can definitely use another new vehicle if you need to replace the existing one. Vans, just like any vehicles, depreciate. So before it cannot be used anymore, you can readily return it and use another vehicle for continuous business use. If you own the vehicle, you will have problem disposing it to buy a new one or you may be spending money for too much maintenance just to make the depreciated vehicle continuously useable.
There are many companies for van leasing to choose from. You just have to check their services and their period of expertise in dealing with commercial vehicle leasing so you’ll get maximum service for your business needs.
The major disadvantage of van leasing is that you have no ownership of the vehicle. As such, you are most likely subject to conditions and terms of usage for the vans. In cases of breakdowns, you are obliged with policies governing breakdown cause by one of your business operations. Despite your effort and money put into the repair, you still don’t own the vehicle. Second disadvantage is that you get to lease used vans. Used vans may not be in good driving condition anymore so it would be detrimental to your business operations.
However, the advantage of van leasing outweighs the disadvantages. First, your payment option is flexible with your terms. Whilst owning brand new vans for your business requires big capital, you can be have a vehicles and be operational already with van leasing. You don’t have to wait until you get big amount to buy vehicles for the business since van leasing only requires deposits and leasing fee paid on a regular basis. There are also arrangements with van leasing companies that suit your current capacity to pay. Second advantage is that van leasing may be using used vans, but these are refurbished models that are definitely useable to new clients. Van leasing companies usually provide used vans to clients since these are vehicles that have previously been leased by other clients. The remodeling of the used vans makes it look like the new user is getting brand new vans for lease. Different models, brands, and sizes of vans has different leasing price so there is definitely one that suits the needs for your business. If your business is into stocks delivery for example, you can find vans that match the distance of your commercial deliveries, the capacity of the stocks usually carried in the van, and the period that you want to use the van for such a routine. Third advantage is that since you don’t own it, you can definitely use another new vehicle if you need to replace the existing one. Vans, just like any vehicles, depreciate. So before it cannot be used anymore, you can readily return it and use another vehicle for continuous business use. If you own the vehicle, you will have problem disposing it to buy a new one or you may be spending money for too much maintenance just to make the depreciated vehicle continuously useable.
There are many companies for van leasing to choose from. You just have to check their services and their period of expertise in dealing with commercial vehicle leasing so you’ll get maximum service for your business needs.
Smart Equipment Leasing: Comparing Bank Financing With Leasing Companies
Savvy business owners who choose to lease business equipment can save themselves hard-earned cash, accumulated debt, and industrial-strength headaches by optimizing their relationships with lending entities.
Customers who are looking to lease equipment for their business most frequently seek financing from one of two sources – traditional bank financing programs, or specialized leasing companies like eLease. The following are four key differences to consider when comparing these programs.
1. Interest Rate FluctuationsIn a healthy economy, banks often choose to offer equipment leasing as a service for their business clients. In this way, banks foster economic growth in local communities by supporting expansion in growing industries. However, banks are not in the business of taking risks, and because of this, their programs are subject to change as current economic conditions falter.An example of this is interest rates. Consistent with their conservative risk philosophy, banks do not entertain risk with interest rates. Typically, bank lines fluctuate on the Prime Rate -- as the Federal Reserve raises or lowers the rate, so will your interest payment increase or decrease. These economic fluctuations can have financial impact on your business outside of your control.The opposite is true for leasing companies, because they take 100% of the interest rate risk. Therefore, when industry rates decrease or increase, your lease payment stays the same. The payment on a lease will never change during its term regardless of interest rates and inflation. You know what you are getting from day one.
2. Impact on Additional FinancingThe way that your financing source reports your leased business equipment with the Secretary of State can directly impact your ability to obtain additional financing for your business.When your business equipment is financed by a third-party leasing company, that company files a UCC (Uniform Commercial Code) which specifies to the Secretary of State where the customer is located, and that the leased equipment is owned by the leasing company. For example, if your business makes the decision to lease an oven for your new restaurant, a leasing company would designate the oven itself as collateral.In comparison, all property owned by the business is stated when a bank finances the lease. A Blanket UCC is usually filed, which includes the equipment as well as all assets. Therefore, not only would the oven for your new restaurant be considered collateral, but so would your entire business.When a blanket UCC is in place, other banks will not want to provide overlapping financing with another lender. If, however, your financing is provided through a third-party leasing company, other lenders will see that only equipment is under consideration, and be favorable to loan financing because they will be able to Blanket UCC the rest of the business.
3. Access to CapitalBoth banks and leasing companies evaluate exposure (the total amount of debt taken on by a company) when considering whether to offer financing. The difference in the way these entities look at total debt can have significant influence on their decision to finance your equipment, as well as other financed assets.In most cases, banks have a borrowing threshold with a borrower. This may include the line of credit on the home, auto loans, credit cards, business debts and personal mortgage. If you get into an amount of debt that the bank sees as a risk, they may choose to end business with your company. Or, they may refuse you financing due to how much debt your already have.Leasing companies deal with the same issue, but only consider the equipment financed for that customer. So, by using a third party leasing company, you can retain access to capital with your banker without tying up credit lines. A business can never have too much access to capital!
4. Flexibility in TermsMost banks are highly structured and cautious in their leasing terms. Frequently, they require 10% to 20% down to finance equipment for a business, with a requirement of security such as a minimum amount in a CD, or reserve in a checking account.While the primary objective of a bank is to protect its interests, a leasing company’s main goal is to generate cash flow. Therefore, leasing companies are highly creative in finding the easiest way for a business to get new equipment. It is not uncommon to terms that include seasonal payments, or no payments for 90 to 180 days.
In summary, a good rule of thumb is to use your bank for working capital, and equipment finance companies to finance equipment.
Customers who are looking to lease equipment for their business most frequently seek financing from one of two sources – traditional bank financing programs, or specialized leasing companies like eLease. The following are four key differences to consider when comparing these programs.
1. Interest Rate FluctuationsIn a healthy economy, banks often choose to offer equipment leasing as a service for their business clients. In this way, banks foster economic growth in local communities by supporting expansion in growing industries. However, banks are not in the business of taking risks, and because of this, their programs are subject to change as current economic conditions falter.An example of this is interest rates. Consistent with their conservative risk philosophy, banks do not entertain risk with interest rates. Typically, bank lines fluctuate on the Prime Rate -- as the Federal Reserve raises or lowers the rate, so will your interest payment increase or decrease. These economic fluctuations can have financial impact on your business outside of your control.The opposite is true for leasing companies, because they take 100% of the interest rate risk. Therefore, when industry rates decrease or increase, your lease payment stays the same. The payment on a lease will never change during its term regardless of interest rates and inflation. You know what you are getting from day one.
2. Impact on Additional FinancingThe way that your financing source reports your leased business equipment with the Secretary of State can directly impact your ability to obtain additional financing for your business.When your business equipment is financed by a third-party leasing company, that company files a UCC (Uniform Commercial Code) which specifies to the Secretary of State where the customer is located, and that the leased equipment is owned by the leasing company. For example, if your business makes the decision to lease an oven for your new restaurant, a leasing company would designate the oven itself as collateral.In comparison, all property owned by the business is stated when a bank finances the lease. A Blanket UCC is usually filed, which includes the equipment as well as all assets. Therefore, not only would the oven for your new restaurant be considered collateral, but so would your entire business.When a blanket UCC is in place, other banks will not want to provide overlapping financing with another lender. If, however, your financing is provided through a third-party leasing company, other lenders will see that only equipment is under consideration, and be favorable to loan financing because they will be able to Blanket UCC the rest of the business.
3. Access to CapitalBoth banks and leasing companies evaluate exposure (the total amount of debt taken on by a company) when considering whether to offer financing. The difference in the way these entities look at total debt can have significant influence on their decision to finance your equipment, as well as other financed assets.In most cases, banks have a borrowing threshold with a borrower. This may include the line of credit on the home, auto loans, credit cards, business debts and personal mortgage. If you get into an amount of debt that the bank sees as a risk, they may choose to end business with your company. Or, they may refuse you financing due to how much debt your already have.Leasing companies deal with the same issue, but only consider the equipment financed for that customer. So, by using a third party leasing company, you can retain access to capital with your banker without tying up credit lines. A business can never have too much access to capital!
4. Flexibility in TermsMost banks are highly structured and cautious in their leasing terms. Frequently, they require 10% to 20% down to finance equipment for a business, with a requirement of security such as a minimum amount in a CD, or reserve in a checking account.While the primary objective of a bank is to protect its interests, a leasing company’s main goal is to generate cash flow. Therefore, leasing companies are highly creative in finding the easiest way for a business to get new equipment. It is not uncommon to terms that include seasonal payments, or no payments for 90 to 180 days.
In summary, a good rule of thumb is to use your bank for working capital, and equipment finance companies to finance equipment.
Common Pitfalls of Equipment Leasing
If you are a business owner considering equipment leasing, keep in mind the legal adage “Possession is nine-tenths of the law”. Paying to use equipment for a specified period of time can save you money, particularly when what you need is expensive, requires frequent maintenance and/or is often upgraded. However, if you don’t understand certain standard terms included in most contracts, you may get some costly surprises at the end of your lease. Here are five common pitfalls and strategies to avoid them.
Pitfall #1: The End-of-Term Surprise
To be flexible according to their customers’ needs, leasing companies typically offer four ways to close out a lease:
· Purchase of the equipment for a fixed amount
· Purchase of the equipment for Fair Market Value
· Return of the equipment
· Continued leasing of the equipment for a specified period (this was a popular profit center in the early ‘90s, but is no longer as common)
Many business owners assume they already know how leasing works and sign a contract without fully understanding these options. When they get a bill for the residual amount, a purchase option at additional cost, or worse – an automatic 12-month lease renewal -- they become upset.
Smart Strategy: Be savvy to make the most of leasing and avoid getting caught short-handed. Be sure you understand what you will own and what you will owe at the end of your lease before you sign a contract.
Pitfall #2: Personal Responsibility for a Business Lease
Required by 90% of leasing companies, the Personal Guaranty pierces the “Corporate Veil,” making the business and its owner equally responsible for paying the lease. In the event that the business experiences financial difficulty, the owner can be held personally responsible for paying out the remainder of the lease.
Smart Strategy: In financial planning for yourself and your business, be prepared for this liability. 90% of all leases have a Personal Guaranty so be aware going into the lease.
Pitfall #3: Required Insurance at an Additional Cost
If your insurance policy will not cover the equipment you plan to lease, or you do not have insurance, most leasing companies will add the cost of coverage to your invoice. Some leasing companies will charge a fee for not having insurance rather than adding insurance.
Smart Strategy: Don’t assume insurance comes with the contract – ask for details about the type and cost of coverage.
Pitfall #4: Sales Tax and Uncle Sam
If you lease equipment, you will need to pay state sales or use tax and, in some cases, personal property tax. You may end up paying more taxes than necessary if you do not fully understand how they are handled in the contract.
Smart Strategy: Ask your leasing agent how they interpret taxes in your state and the most efficient way to minimize these expenses. For example, in Florida there is a $1.00 versus a $101.00 buyout. If you choose to buy your equipment at the end of the term for $1.00, you will pay sales tax on the whole outstanding balance. However, with a $101.00 buyout, you will pay sales tax on the monthly payment only, which can represent substantial savings.
Pitfall #5: Limited Recourse
A leasing contract is a three-way contract in which you agree to pay the leasing company back for the equipment from the vendor you chose. The leasing company agrees to pay your vendor and you agree to make payments -- the rest of the contract covers the terms of what happens if you don’t make your payments. The leasing company can’t pick the equipment for you, and you are responsible for all the monies under the lease regardless of the effectiveness of the equipment your vendor provides.
Smart Strategy: Choose your vendor and equipment carefully. Read your contract and ask questions, making sure you understand your responsibilities as well as your options.
Pitfall #1: The End-of-Term Surprise
To be flexible according to their customers’ needs, leasing companies typically offer four ways to close out a lease:
· Purchase of the equipment for a fixed amount
· Purchase of the equipment for Fair Market Value
· Return of the equipment
· Continued leasing of the equipment for a specified period (this was a popular profit center in the early ‘90s, but is no longer as common)
Many business owners assume they already know how leasing works and sign a contract without fully understanding these options. When they get a bill for the residual amount, a purchase option at additional cost, or worse – an automatic 12-month lease renewal -- they become upset.
Smart Strategy: Be savvy to make the most of leasing and avoid getting caught short-handed. Be sure you understand what you will own and what you will owe at the end of your lease before you sign a contract.
Pitfall #2: Personal Responsibility for a Business Lease
Required by 90% of leasing companies, the Personal Guaranty pierces the “Corporate Veil,” making the business and its owner equally responsible for paying the lease. In the event that the business experiences financial difficulty, the owner can be held personally responsible for paying out the remainder of the lease.
Smart Strategy: In financial planning for yourself and your business, be prepared for this liability. 90% of all leases have a Personal Guaranty so be aware going into the lease.
Pitfall #3: Required Insurance at an Additional Cost
If your insurance policy will not cover the equipment you plan to lease, or you do not have insurance, most leasing companies will add the cost of coverage to your invoice. Some leasing companies will charge a fee for not having insurance rather than adding insurance.
Smart Strategy: Don’t assume insurance comes with the contract – ask for details about the type and cost of coverage.
Pitfall #4: Sales Tax and Uncle Sam
If you lease equipment, you will need to pay state sales or use tax and, in some cases, personal property tax. You may end up paying more taxes than necessary if you do not fully understand how they are handled in the contract.
Smart Strategy: Ask your leasing agent how they interpret taxes in your state and the most efficient way to minimize these expenses. For example, in Florida there is a $1.00 versus a $101.00 buyout. If you choose to buy your equipment at the end of the term for $1.00, you will pay sales tax on the whole outstanding balance. However, with a $101.00 buyout, you will pay sales tax on the monthly payment only, which can represent substantial savings.
Pitfall #5: Limited Recourse
A leasing contract is a three-way contract in which you agree to pay the leasing company back for the equipment from the vendor you chose. The leasing company agrees to pay your vendor and you agree to make payments -- the rest of the contract covers the terms of what happens if you don’t make your payments. The leasing company can’t pick the equipment for you, and you are responsible for all the monies under the lease regardless of the effectiveness of the equipment your vendor provides.
Smart Strategy: Choose your vendor and equipment carefully. Read your contract and ask questions, making sure you understand your responsibilities as well as your options.
Audio Visual Equipment Leasing
Obtaining the fixed assets for a period of time is what leasing is all about. There is hiring leasing and finance leasing. While we talk about broadcast or audio visual equipment leasing we would usually refer to hiring leasing. Talking about leasing it is important to know that lessee is the person who takes the equipment or any other property into lease and lessor is the person who is into the business of selling or leasing of the equipment.There could be various reasons why one can go for audio visual equipment leasing. The prime among them could be related to the asset management. When you hire equipment for a specific time frame, the equipment stays with you for that time at fixed payments. The risks of equipment ownership is assumed and taken care of. When we are talking about equipment finance leasing it gives the lessee the purchasing power to acquire additional equipment. The most important reason why people go for leasing is there is no down-payment required for getting the equipments under lease. One of the other major advantages of lease is that it provides you with complete finance and favorable terms and conditions than the traditional loaning systems. With leasing you are also entitled for some major tax benefits. Tax benefits could be grabbed by you when you are leasing the equipments because, leasing would be deemed as periodic rental expense which would be deduced from the tax that you are supposed to pay. But if what is being shown as lease is not a lease but provisional sale or repayment of the installment, you are not entitled for the tax benefits. Hence, it is important to understand the difference between leasing the equipment and purchasing it. Best of the best equipments and offers are made at minimal expenditure. This is the downright benefit of leasing. With equipment leasing you become immune to inflation. The amount which you have to pay to the lessor is fixed and will not change as the market changes. But one has to be very cautious with the wear and tear. This has been one of the major concerns in the leasing because when you take any equipment for lease, you are responsible for the wear and tear of the equipment. So you should question the lessor about the prior maintenance of the equipment. You should also read the leasing deal document watchfully. Evaluate the points like the monthly budget you can afford and if the equipment will last till the lease term or you would have to make the repairs in the middle of the lease period, out of your own pocket? If you are looking for a super cheap deal then prefer the short term period offers. Do your own R&D before leasing any equipment. There are online leasing firms online and offline. Research properly, evaluate the entire thing on the basis of the parameters discussed above and go for it.
The Mechanics of a Lease Transfer
Although you may not feel it right now, the looming economic crisis has already stretched out its claws and has scratch the surface of even the most stable industries in the world. This is why lease takeover transactions are becoming more and more popular today among car buyers and car owners. This transaction for purchasing a car is not necessarily exclusive to car owning and buying—after all, lease transfers or lease takeovers are also common among other type of properties. However, cars are more accessible (there are more car owners than homeowners, after all) in terms of price and utility, hence the popularity of lease transfer transactions. Many buyers and sellers are hesitant to enter into this kind of transaction, since they are easily intimidated with lease procedures. However, at its very core, a lease transfer is simple—and practical.DefinitionBut what exactly is a lease transfer? Simply put, this is a transaction where an individual who bought a car on a lease will sell his or her property to other interested individuals. This process is differentiated from the mere selling of a car because the lease here has not been paid by the original owner. In short, the new buyer will pay for the remaining lease payments. The seller is transferring the lease to another owner, while the buyer is assuming responsibility for the lease. Obviously, this process works both for the seller and the buyer.Advantage and repercussionsRemember that the original owner of the car is under contract. This contract would require the owner of the car to pay a lease cancellation fee if the request for one is approved. While this procedure may seem more convenient, the penalty for lease cancellation can usually equal to the total amount one would pay for the original lease itself. Needless to say, for someone who needs to get out of a lease, a lease transfer is a better option. Those looking to buy a car on a lease takeover, on the other hand, would enjoy cheaper car prices. The new buyer will no longer have to pay for the previously paid fees; he or she is merely responsible for the unpaid dues. Of course, as with most transactions, there are also a number of repercussions, mostly on the side of the buyer. Taking over a lease is just like buying a second-hand car; the property may no longer be in a pristine condition. Nonetheless, a lease transfer is an effective way to get out of a lease legally and practically, and also a safe and cheap source for perspective automobile buyers. ChoicesLease transfers give buyers and sellers options. With this, they are no longer stuck with unfavorable set-ups and can choose not to be bound by ruthless contracts. This gives people the choice to pick the most suitable option of buying and selling cars. In a time when financial matters should be taken very seriously and given much thought, it is about time people give lease transfer procedures a chance.
The Benefits of Auto Lease Assumptions-Take Over An Existing Lease
If you are considering an auto lease, you may be able to get a better deal and more benefits if you take over a prior lease from an individual, instead of leasing a vehicle directly through a dealer. Because auto leases are for a relatively short period of time, it can be difficult to exit a lease early and return the vehicle. Many dealers will apply early termination fees, or insist on all of the remaining lease payments. Auto lease assumptions allow you to take over the rest of the lease term from the individual, including the monthly payments, so the lease contract is fulfilled and the person is not hit with additional fees.Why would you consider an auto lease assumption? This approach has several advantages over traditional leasing. First of all, you will not have to come up with a down payment in order to start driving the vehicle. All you have to do is take over, or assume, the monthly lease payments. If a person paid $2000 down and has a $299 monthly payment, you just have to take over the monthly payment portion, which creates a big savings. Another distinct advantage is the ability to have a shorter and more flexible lease term. A traditional lease is usually four-five years. However, with auto lease assumptions, the lease term is normally just two years, and in some cases you can get an assumption with just one year left on the lease. That way,you won't be stuck with a vehicle you might be tired of, and will be ready to trade in for a new one.Auto lease assumptions are relatively easy to initiate and complete. There are several popular sites that allow the holders of a lease to advertise a vehicle, and the sites will help guide you through the transfer process. The online sites are usually the best place to start.The first thing to do is to get pre-approved for a lease assumption. Like getting a new lease, taking over an existing one does require relatively good credit. If you are shopping through a website, you will normally be able to fill out an application online. Like getting pre-approved for a home loan before you start house shopping, get pre-approved for auto lease assumptions first will give you the most choice and flexibility.The next thing is to chose the vehicle. You will normally get to see photos first, which will help you make your initial decision. If you are live long-distance from the seller, you can usually make arrangements to get the vehicle inspected for you, the third party companies who help facilitate the assumption will often offer an inspection service. You certainly want to get the vehicle properly inspected before you take over the lease.Once you and the seller agree on the vehicle, the seller will initiate the transfer. Your credit application is sent to the original leasing company,and when approved, they will create the new leasing documents that both you and the seller need to sign. Once the leasing company has verified everything and the new paperwork is issued, the seller is notified, and you will make arrangements to receive the vehicle.Auto lease assumptions have many benefits. They allow you to lease a vehicle of your choice for a shorter period with out a down payment. If you are willing to do some research and to work with a seller, you can often get a great deal.
Nine Advantages of Truck Leasing Vs Purchasing
Advantages of Truck Leasing Vs PurchasingTruck leasing to get that truck equipment you need today instead of purchasing, can be a cost-effective option, particularly if you don't have ready cash on hand. The same acquisition rationale applies to all heavy equipment. Along with being able to regulate your cash flow more effectively, truck leasing offers these additional advantages: Asset Management.A truck equipment lease provides the use of equipment for specific periods of time at fixed payments. Depending on how the truck lease is structured, the lessor assumes and manages the risk of equipment ownership. At the end of the truck lease, the lessor is responsible for the disposition of the asset. Balance Sheet Management ** Because an operating truck lease is not considered a long-term debt or liability, it does not appear as debt on your financial statements, thus making you more attractive to traditional lenders. Current Technology ** If the nature of your industry demands that you have the latest truck technology a short-term operating truck lease can help you get the needed equipment and keep your cash out-lay to a minimum. Your risk of getting stuck with obsolete equipment is lower because you can upgrade or add equipment to meet your ever-changing needs.Customized Payment Solutions ** A variety of truck leasing products are available, allowing you to tailor a program to fit your month-to-month or year-to-year cash flow needs. Some lessors offer stepped- payment programs, with the payments being smaller at the beginning of the lease to allow the lessee's cashflow to build. The payments then ramp up latter in the payment schedule when the new truck(s) have increased the business revenue. Other lessors offer seasonal deferred payment programs for businesses that experience cashflow challenges during the year. Always ask for these options. Independent lessors want your business. If it makes sense financially, they will often accommodate your needs.Flexible End Of Term Options ** There are several options for disposing of equipment after the lease term ends including returning the equipment, renewing the lease or purchasing the equipment.Flexibility ** As your business grows and your needs change, you can add or upgrade at any point during the lease term through add-on or master leases. Lessors want you as a long term customer and are often creative in how they structure a truck lease for you. Captive or in-house truck leasing programs may not be as flexible. So, you can often find more flexible truck leasing arrangements with Independent Truck Leasing Companies.Immediate Write-Off ** Truck Lease payments can be treated as expenses (depending on how the lease is structured) on a company's balance sheet, therefore, truck equipment does not have to be depreciated over five to seven years. (Consult with your tax professional prior to making major asset acquisition decisions)Improved Cash Forecasting ** By leasing need truck equipment you know the amount and number of lease payments over the life of the leasing period, so you can accurately forecast cash requirements for your equipment.Tax Benefits ** The IRS does not consider a truck operating lease to be a purchase, but rather a tax-deductible overhead expense. Therefore, you can deduct the equipment lease payments from your corporate income. (Consult with your tax professional prior to making major asset acquisition decisions).
Net Leased Real Estate and the Well Rounded Portfolio
Income-producing real estate is an essential component of a well-rounded investment portfolio, providing both income and enormous potential appreciation. There are many different ways to add a real estate component to a portfolio, however, often investors must choose between limiting potential capital appreciation by investing in managed funds, usually with high expenses, or purchasing income properties such as apartment and office buildings, together with all of their associated maintenance and management problems. Fortunately, there is a third alternative – net leased investment properties, commonly refered to as triple net or by the acronym NNN.What is a net leased investment?There are several types of net leases but for this article we will consider one called a triple net lease, or absolute net lease. In a triple net lease, the tenant agrees to be responsible for all expenses, eliminating the need to hire a property manager and to continuously shell out money for repairs and maintenance. The tenant usually pays the rent, plus taxes, maintenance and insurance. It is common to see this type of lease used by retail chain stores and restaurants during an expansion phase. The retailer can quickly open new stores without having to purchase real estate and can put all of their capital to work immediately without having to tie any up in real estate equity. This capital retention comes with a price – which is paid to the owner of the real estate in the form of generous lease terms.From an investor’s standpoint, purchasing a net leased investment property affords many benefits. The primary advantage of net leased investment is the ability to retain any appreciation in the property while, at the same time, avoiding expenses and management responsibilities. Essentially, a net leased property cherry-picks the advantages of other forms of real estate investment and bundles them up into an easy-to-own-and-operate, income property with a steady income stream for many years. As a 1031 exchange vehicle, net leased investments are unmatched due to the ease of identification and transfer. Since management and maintenance issues are minimal, investors may focus almost entirely on return on the capital and the credit worthiness of the tenant when comparing and selecting properties.What are the risks of owning a net leased property?Many of the risks of net leased ownership are the same as any real estate investment. The property value can depreciate in down markets, although given the long term nature of net leases, the likelyhood of this happening over the life of the lease is usually minimal. It is likely, however, that the cost of literally everything will appreciate over the life of the lease. This is also known as inflation, and must be factored in when considering a net leased investment property. The best way to mitigate inflation is to build rent increases into the lease and to tie any renewal options to market rates or an inflation-adjusted index. This can be a tricky negotiation since neither the tenant nor the owner rally knows what the inflation rate will be over the life of the lease.Another consideration is the tenant’s track record and credit-worthiness. Obviously, leases signed by large corporate chains can be a safer investment, but may come with a lower return. An investor may be willing to take on a little more risk to gain a higher return. A good candidate for this tactic is a franchisee owner operating several locations of a large chain. Look for a tenant who can demonstrate successful operation of multiple locations for five years or more.Fortunately, in most net leased investments these negotiations have already been handled by qualified real estate professionals. Before purchasing a net leased investment property, be sure to have your advisor review the terms of the lease to make sure that the lease rate is at or near market rates and will remain at market over the life of the lease. Even if the lease rate is above market, which may seem to be an attractive investment, be aware that this could make it difficult to renew at the current rate after the lease expires. It is also possible that some improvements have been built into the lease rate – improvements which will have fully depreciated by the time the lease expires or which may not be desirable to the next tenant.Where to go from here?Think of net leased investment more as purchasing the lease, rather than the property itself. The property has already been selected by the tenant as a good location for their business. Now you must select both the property and the tenant - and they come as a package, inseparable for many years. The advice of a net leased real estate expert will be invaluable in making this selection. Don’t rely on a local real estate agent. The pool of available net leased investments is large and the target geographic area consists of the entire country. Contact a professional with the resources to compare properties in multiple cities and states. You will not have to drive out to your property to fix any leaks, so don’t limit yourself to nearby areas.A net leased property is a long-term investment with many factors to consider.
Net Leased Real Estate and the Well Rounded Portfolio
Income-producing real estate is an essential component of a well-rounded investment portfolio, providing both income and enormous potential appreciation. There are many different ways to add a real estate component to a portfolio, however, often investors must choose between limiting potential capital appreciation by investing in managed funds, usually with high expenses, or purchasing income properties such as apartment and office buildings, together with all of their associated maintenance and management problems. Fortunately, there is a third alternative – net leased investment properties, commonly refered to as triple net or by the acronym NNN.What is a net leased investment?There are several types of net leases but for this article we will consider one called a triple net lease, or absolute net lease. In a triple net lease, the tenant agrees to be responsible for all expenses, eliminating the need to hire a property manager and to continuously shell out money for repairs and maintenance. The tenant usually pays the rent, plus taxes, maintenance and insurance. It is common to see this type of lease used by retail chain stores and restaurants during an expansion phase. The retailer can quickly open new stores without having to purchase real estate and can put all of their capital to work immediately without having to tie any up in real estate equity. This capital retention comes with a price – which is paid to the owner of the real estate in the form of generous lease terms.From an investor’s standpoint, purchasing a net leased investment property affords many benefits. The primary advantage of net leased investment is the ability to retain any appreciation in the property while, at the same time, avoiding expenses and management responsibilities. Essentially, a net leased property cherry-picks the advantages of other forms of real estate investment and bundles them up into an easy-to-own-and-operate, income property with a steady income stream for many years. As a 1031 exchange vehicle, net leased investments are unmatched due to the ease of identification and transfer. Since management and maintenance issues are minimal, investors may focus almost entirely on return on the capital and the credit worthiness of the tenant when comparing and selecting properties.What are the risks of owning a net leased property?Many of the risks of net leased ownership are the same as any real estate investment. The property value can depreciate in down markets, although given the long term nature of net leases, the likelyhood of this happening over the life of the lease is usually minimal. It is likely, however, that the cost of literally everything will appreciate over the life of the lease. This is also known as inflation, and must be factored in when considering a net leased investment property. The best way to mitigate inflation is to build rent increases into the lease and to tie any renewal options to market rates or an inflation-adjusted index. This can be a tricky negotiation since neither the tenant nor the owner rally knows what the inflation rate will be over the life of the lease.Another consideration is the tenant’s track record and credit-worthiness. Obviously, leases signed by large corporate chains can be a safer investment, but may come with a lower return. An investor may be willing to take on a little more risk to gain a higher return. A good candidate for this tactic is a franchisee owner operating several locations of a large chain. Look for a tenant who can demonstrate successful operation of multiple locations for five years or more.Fortunately, in most net leased investments these negotiations have already been handled by qualified real estate professionals. Before purchasing a net leased investment property, be sure to have your advisor review the terms of the lease to make sure that the lease rate is at or near market rates and will remain at market over the life of the lease. Even if the lease rate is above market, which may seem to be an attractive investment, be aware that this could make it difficult to renew at the current rate after the lease expires. It is also possible that some improvements have been built into the lease rate – improvements which will have fully depreciated by the time the lease expires or which may not be desirable to the next tenant.Where to go from here?Think of net leased investment more as purchasing the lease, rather than the property itself. The property has already been selected by the tenant as a good location for their business. Now you must select both the property and the tenant - and they come as a package, inseparable for many years. The advice of a net leased real estate expert will be invaluable in making this selection. Don’t rely on a local real estate agent. The pool of available net leased investments is large and the target geographic area consists of the entire country. Contact a professional with the resources to compare properties in multiple cities and states. You will not have to drive out to your property to fix any leaks, so don’t limit yourself to nearby areas.A net leased property is a long-term investment with many factors to consider.
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