Key Facts About Equipment Leasing - UK

Here is our 60 second key facts guide to UK equipment leasing.

• Unlike other forms of commercial finance applying for equipment leasing finance is a very simple process. All that's needed is a short one page leasing proposal form and the equipment quote(s) for the initial application. Supporting information to complete the application should already be available such as bank statements and accounts etc.
• Timescales from application to loan completion are fast, typically around 2 weeks!
• The lower cash outlay normally needed for an equipment finance facility means that you can buy more or higher specification equipment in comparison to outright purchase!
• Monthly payments (rentals) are fixed for the term of the lease which means all future costs are known.
• By leasing cash can be retained within the business thereby preserving working capital for use elsewhere within the company.
• Where sufficient cash is not available to purchase equipment, leasing gives access to plant & machinery that otherwise might not be available.
• UK rules mean that 100% of monthly rentals can be offset against tax, this can make leasing cheaper than outright purchase or other commercial loans.
• Where the latest technology is a must to remain competitive, leasing provides a sustainable upgrade path at agreed intervals.
• Finally, equipment already owned can be used to raise working capital via leasing sale and leaseback finance facilities.

The Banking Crisis

Yesterdays collapse of the share price of Royal Bank Of Scotland can only delay any recovery in interbank lending which is at the heart of the "credit crunch". It could now be argued that RBS has "cleared the decks" and declared all it's loan problems, but what about the other banks? If suspicions remain then no credit easing will take place further delaying any recovery in the commercial loan and personal finance sector!

Invoice Factoring Calculator

Our web-site offers a number of commercial calculators that help our visitors work out the potential costs of various business loans.

The latest is an Invoice Finance Calculator that will give an illustration of costs and how much cash flow could be increased by based on turnover.

Remember to qualify for a factoring facility a company must trade with other businesses and offer credit terms.

Eland Business Services Limited are specialist Factoring Finance Brokers in the UK.

Bridging loans and buy to let investments

A news report today says that experienced buy to let investors are using bridging loans to take advantage of "distressed residential & commercial propery sales". Demand for bridging finance has increased by over 200% over the last 9 months, apparently. We think this probably means enquiries rather than completions based on the low loan to values on offer by the larger bridging lenders. However we are positive that the main thrust of the article with regard to experienced landlords is without doubt true.

As commercial loan specialists we can help with all short term bridging requirements and arrange the exit too! Visit our web site for more information and don't forget to check out our latest buy-to-let mortgage deals while you are there.

Upgraded Commercial Mortgage Calculator

We have upgraded and improved the results from our Commercial Mortgage Loan Calculator as a free benefit for all our web site visitors.

As well as returning the costs for the mortgage interest rate input, the calculator now also gives an example of the costs if interest rates were to rise or fall by 2%, subject to a minimum rate of 1%.

Are The UK Banks Playing Fair?

It seems perverse that the main banks are calling in overdrafts or imposing arbitary credit limits for say an invoice factoring facility on businesses that are growing. This is despite being rescued by the taxpayer (some of them at least), on the condition that they lend "normally", whatever that means.

In fact one of those rescued banks has in fact withdrawn a commercial loan offer for a MBO at the very last moment due to "market conditions". This is for a business that should trade well and actually grow in the hard times that face us.

Yes, there are in fact many companies that will grow even during a recession! It's perhaps too early in the rescue process to pass judgement on the banks, so let's hope they don't make things much worse than they need to be!

Business Leasing - A 100% Commercial Loan

When searching for Commercial Loans to raise capital for your business the closest you can get to a 100% finance option is Business Leasing! Typically one monthly rental payment suffices as a full deposit to purchase that new asset such as equipment, plant or machinery. The cost of installation, maintenance and warranty could be added to the loan too!

If your company needs new equipment then business leasing could be beneficial. Some of the circumstances where leasing could be the logical choice are:-

• You don't have the cash to buy your new equipment but need that asset today.


• You do have the cash, but reducing your working capital may compromise your business.


• You don't need new plant or machinery but you do have exisiting assets that have a good residual value against which a sale and business leaseback finance facility could be utilised.


• Because you can fully offset monthly payments against tax, it makes commercial sense to lease for your business.


• Your business assets have a short useful life span and need to be replaced regularly.

For more information we recommend further reading at our specialist Leasing Finance pages.

Can a Bridging Loan Really Complete in Less than 24 Hours?

Most bridging lenders emphasise their speed of service when advertising short term loans. Providing funds within 24-48 hours from application to completion shows the flexibility of non-status bridging loan products and the providers. Can a property deal really be financed in such a short time-scale? Well, the answer is yes, but I wouldn't bank on it!

To achieve such a fast loan completion much of the background work needs to be already available, such as a property valuation that is acceptable to the potential bridging lender with most of the necessary legal work ready and waiting at your solicitors, i.e. search, title deeds etc. Representatives of both the lender and borrowers need to be in a position to move quickly. Even when everything is available things can still go wrong, for example, an unexpected question arises from the documentation provided.

Our simple recommendation is not to get into the position of needing a bridging loan in such a short timescale, even where a more relaxed 5-10 day timeframe is available, the unexpected can cause delays. Where a customer needs to raise cash and a high speed bridging finance solution is the correct loan option then the borrower should minimise the risk of delay by keeping in control of what is in their own domain i.e. own solicitors and providing all requested information at the start of the process as delay here can extend time to completion resulting in a missed deadline.

If you need finance quickly then a good bridging loan broker should be able to help reduce the potential for delays.

More Commercial Finance News

One of the main unsecured Payroll Finance Lenders in the UK temporarily stepped out of the market place last week leaving just one active lender. This payroll lender currently expects to return once new funds have been raised, maybe in a couple of months.

UK Businesses in their quest to raise working capital are increasingly turning to equipment leasing and more specifically selling and leasing back existing assets. This financing method is typically a much easier way to generate cash for a company and expect requests for leasing to increase in popularity over the coming months. Of course all the main benefits of leasing such as the tax advantages are the same whether equipment is new or re-financed!

Property Development Funding - 100% Funds available in the UK

Many UK property development lenders in the highly geared loan market are now sitting on their hands and not lending. However 100% funding is still available although severely restricted in supply. One of our 100% residential property development loan lenders has an appetite and positive lending attitude for part completed developments bought below market value from receivers.

If you are a UK developer who has identified such a property based opportunity then we would like to hear from you via our main web-site.

Eland Business Services Limited are Property Development Loan Brokers.