An Equipment Loan Might Not Be What You Think! Kick Starting Asset Financing Success With Canadian Leasing Companies

You’re One Step Away From The Benefits Of Lease Financing Approval


Information on effective strategies to deal with leasing companies in Canada. Equipment loan and asset finance tips for financing success





Unfortunately a huge number of Canadian business owners devote a huge part of their time in business life to asset finance; in effect trying to find capital for their business. Many times the solution to that challenge is with leasing companies in Canada ready and willing to provide those business people with equipment loan and lease financing.

What then are some of the key issues that get you one step away from business financing success when it comes to acquiring assets for your firm? As a business owner or financial manager you want to get the amount of capital you need with the least amount of risk you are willing to take on via debt.

Leasing companies, via asset finance in Canada are one of essentially five ways to raise capital for assets. (Those other four are of course supplier loans, bank financing, term loans, or equity injections from owners).

Why then do 80% of business owners in North America constantly utilizing lease finance as a business strategy, instead of simply buying the assets? Flexibility is one reason, your assets can be financed on shorter terms , via a ' lease to use ' type strategy, or longer amortizations via a lease to own transaction .Depending on which of the two you choose you again ( and here's our flexibility again ) can either return the asset or take ownership of it .

Canadian accounting practice sets up specific rules that deal with different types of lease strategies , either recording the lease on your ' books ' or in some cases, via an operating lease setting your transaction up as an expense . As boring as it might seem to spend some time on lease accounting implications the right choices in this area can save you a lot of dollars, and grief ! .. when it comes to financial reporting, tax time, etc.

Clients seem to slowly get the point here, in that your lease management becomes part of your overall business strategy, and takes some planning. It’s a good vehicle for getting some communications between the users of assets in your company as well as the finance side of the business!

In that manner we ' preach' to clients that lease arrangements are driven from several areas of management thinking:

The ability to borrow

The convenience provided by leasing companies

Risk avoidance in asset ownership via an equipment loan

Tax and accounting implications/benefits


One of the most powerful examples of risk avoidance in asset ownership via assistance from Canadian lease companies is the area of technology and computer financing. Who in their right mind, asks the business owner, wants to take on the risk of technology obsolescence in the area of computing, which seems to change every 5 minutes, including the newest grey area of computing, ' THE CLOUD '.

Does an equipment loan or lease have a lower or higher cost? That’s a typical question from many clients who are at the crossroads of the lease vs. buy decision. This is where your finance folks or accountants take variables into effect such as your firms cost of borrowing, the rate in the lease , and hopefully always making every aspect of their comparison an ' apples to apples ' assessment .

Other factors in the lease vs. buy decision might include down payment scenarios, credit covenants with current lenders, depreciation policies, residual value of the asset at the end of the lease or loan, etc!

As we have shown, an equipment loan or lease might not always be as simple a consideration as you might think. But it continues to be the financing of choice, everyday, for thousands of Canadian businesses. Speak to a trusted, credible and experienced Canadian business financing advisor today about getting on track with Canadian leasing companies for asset finance.





Stan Prokop - founder of 7 Park Avenue Financial –


http://www.7parkavenuefinancial.com


Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 80 Million $$ of financing for Canadian corporations . Core competancies include receivables financing, asset based lending, working capital, equipment finance, franchise finance and tax credit financing.
Info re: Canadian business financing & contact details :


http://www.7parkavenuefinancial.com/leasing_companies_equipment_loan_asset_finance.html

Having Difficulty Choosing The Right Equipment Loan For Asset Financing Needs in Canada ? 4 Leasing Company Choices

Business Lease Finance Options That Work

Information On 4 equipment loan Sources in Canadian Asset Financing . Do you know which leasing companies You Should Be Dealing With



Canadian business owners and financial managers are often faced with the decision of who to turn to when making decisions on equipment loan and asset financing. You have essentially 3 difficult decisions and one easy one which we'll share with you.

The reality is that if you're not a business equipment financing expert there are a large number of equipment lessors out there - the challenge is pretty simple - ‘which one is right for your firm?'. For those that aren’t fully aware of how the equipment financing market is structured in Canada it’s a case of really determining which lessor business model, and credit box (credit box?) fits your needs.

Let's examine the things you need to know to get a ‘perfect fit' in equipment loan and asset financing needs.

Potential partner # 1 -not who you might think it is. Canadian chartered banks. In recent years banks have invigorated their interest in equipment financing, and they compete strongly with independent commercial financing companies through leasing subsidiaries or divisions. Banks themselves can only write loans, so they use their lease subsidiaries to write real leases. The challenge to obtaining some of the best rates in equipment finance via a bank is your ability to meet credit criteria. In addition to the asset collateral banks will demand strong balance sheets and positive and sustainable cash flows. Note also that typically banks only write capital l eases, or lease to own transactions - operating leases generally not available.

Potential partner # 2- The main competition to the banks in Canada are independent commercial leasing companies. These may be small, large, Canadian, or U.S. owned. This is most likely where you will get the most creative structures and market pricing that fits your overall credit quality. Almost any asset can be leased in Canada, including technology and software. Unlike the banks operating leases are potentially available also.

Because these firms borrow from insurance companies or banks to fund your transaction the overall cost of financing is pretty well always going to be a bit higher. In Canada the equipment financing market is broken down into small ticket, mid ticket and large ticket transactions. We speak to a lot of clients who have wasted time by either choosing the wrong type of leasing companies, or who don’t understand the approval criteria of any given firm.

Potential partner # 3 - You're being held captive here. Captive? Captive finance firms are divisions or entities of large vendors who sell to you. They have formed their own leasing division and asset financing vehicles to offer capital leases, operating leases, and in some case even rentals. Rates are generally quite competitive and the added advantage here is that they are incented to sell you their product also, not only finance it, so credit criteria is often relaxed a bit. These firms make acquiring their products simple, which is a benefit to the Canadian business owner.

Knowing which potential partner to utilize for your equpment financing needs is critical. But how do you not waste time in talking to, investigating, and sharing your firms confidential financial information with tens or hundreds of firms. That’s solution # 4- utilizing as a partner an independent Canadian business financing advisor who knows the entire market and can save you time and significant dollars in sourcing the right funding that matches y our needs.

Their services tend to be no charge to your firm and solid equpment financing advisors are well known and respected by the industry itself - therefore your transaction is a valued one. In searching for a great advisor spend time testing their market knowledge, contacts, and references.




Stan Prokop - founder of 7 Park Avenue Financial -


http://www.7parkavenuefinancial.com

Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 80 Million $$ of financing for Canadian corporations . Core competancies include receivables financing, asset based lending, working capital, equipment finance, franchise finance and tax credit financing .Info re: Canadian business financing & contact details :


http://www.7parkavenuefinancial.com/equipment_loan_asset_financing_leasing_companies.html

A Common Sense Way To Choose Canadian Business Leasing Companies For Equipment Loans – A Lease & Loan Alternative

Make the Right Choice for Lease Finance in Canada



Information for Canadian business on choosing the best method to select leasing companies for equipment loans – A lease and loan alternative selection process .




Rest assured you're in the same boat as thousands of your competitors - and whats that boat about? Simply not knowing who or what to turn to when selecting business leasing companies for an equipment loan for your business. More importantly, leases and loans that makes sense, not the kind where you wonder if your firm got a transaction at market rates, terms, and structures.

So is there a fast track to selecting the right lease finance company for asset financing that works, and makes sense? There are a couple of challenges we try and help clients overcome, not the least of which is the fact that there are tens and literally hundreds of firms all across Canada that ' seemingly ' fit your needs. And, and it’s a big and... if you have all the time in the world to develop relationships with these hundreds of firms, well then... let’s just say we're jealous!

But not knowing who to turn to can in fact, as many clients have experienced, cost you tens and thousands of dollars, depending on your past experience with leasing companies in Canada. One alternative is of course to send a lease bid document out to a large number or select number of parties. That makes sense for government agencies and large corporations probably, but not for small and medium sized businesses in Canada.

The reality is that all those lessors out there have their own unique business models, and are you ready... because this could be painful... they are going to try and fit your firm in a box . In a box? We're talking about the ' credit box ‘... that elusive credit policy that seems to be understood, by the lessor, but not perhaps yourself. You see each firm (who by that way had to go out and borrow money to lend it to you) has a credit box. In that box is a set of criteria around asset types, deal sizes, ratios, covenants, personal guarantees, outside collateral, years in business... well we think you get the drill

And oh yes, if there were one type of business equipment leasing company in Canada the search for asset financing might not be so daunting. In reality those hundreds of different firms are actually in 4 sub categories.

Those sub categories are bank lessors, independent leasing companies, captives (ouch! that even sounds painful - do they have a box also?) , and insurance companies.

So do we have a favorite and a recommended solution for each and every business owner and financial manager in Canada? Actually we do its number 5 in our list of 4! We're talking about an independent, experienced, trusted, and credible Canadian business financing advisor... one who should be an expert in lease financing. Utilize their experience for market knowledge, eliminating financing sourcing time, and ensuring you are getting market rates in the current low interest rate environment of 2011 where in fact lease financing is very competitive and wants your business. Adding value and saving your firm money is a powerful double punch in Canadian asset financing.




Stan Prokop - founder of 7 Park Avenue Financial -

http://www.7parkavenuefinancial.com

Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 80 Million $$ of financing for Canadian corporations . Core competancies include receivables financing, asset based lending, working capital, equipment finance, franchise finance and tax credit financing .Info re: Canadian business financing & contact details :


http://www.7parkavenuefinancial.com/leasing_companies_equipment_loan_loans_business.html

Is A ‘ Good Enough ‘ Equipment Loan & Finance Lease Better Than ‘ Best ‘ For Canadian Finance Lease Needs ?

We're pretty sure, in fact very sure, that ' good enough' is not the attitude you take in any aspect of your business or business financing needs. Settling for 2nd best in today’s competitive environment is not a recommended strategy! So let’s look at how you can achieve some of the best leasing and financing equipment loan strategies for finance lease success in Canada.

New assets are always a challenge for acquisition when Canadian business owners and financial managers assess their respective financial positions. The price and therefore how you will finance these assets is of course critical to your overall asset acquisition strategy.

So when it comes to reducing cash outflows and in effect saving monies via a financing strategy is any wonder why over 80% of Canadian businesses utilize leasing financing as an integral part of their finance strategy.

But the reality is that many owners and managers don't understand the make up and the competitive offerings that make up the Canadian equipment loan and lease landscape. Even more importantly just understanding the rights and obligations and options of different types of leases can save any business owner or manager thousands of dollars, depending on overall purchase price. Even more dramatically we can say that making the wrong decision can actually cost you significantly.

Let’s utilize a quick example. Let's say you are focused on the amount of monthly payment and want to buy a 150,000 computer and software package (yes, software can be leased). So you contact a firm who you think can give you the best monthly payment, and you find you are quoted and approved for a 5 year term, monthly payment of 3000.00$. A quick expert calculation will tell you that you will pay 31000$ in interest over that 5 year term at current competitive rates. Sounds ok?? Maybe, maybe not.

Moving on... what if we told you that you could finance that same system for 3500$ / mo for a 3 year term , and at the end of the term you could return, upgrade , or choose to extend the lease .
For only 500$ more you have shortened your term, recognizing that most computers don’t last 5 years. In effect you have utilized an operating lease strategy to effectively manage your assets - that’s a solid financing decision in leasing financing.

We have utilized a simple example of how you need to in essence separate the pricing and the purchase of the asset from the decision of how to finance that same asset.

We're the first to admit the leasing process can be perceived as complex in Canada. There are hundreds of equipment loan and finance lease firms. They have different ' credit boxes ‘- meaning simply you must fit into their asset, deal size, and credit criteria box. Additionally numerous firms tend to complicate matters by throwing arcane terms at you such as ' down stroke ' , ' security deposit ', 'capital lease ' ' off balance sheet financing ' ' admin set up fees ' .. Etc. And on it goes.

In summary, leasing financing in Canada has huge benefits. Billions of dollars of assets are leased every year. Your competitors finance their assets. And yes, you could very quickly go out and achieve a ' good enough ' lease.

Want a better solution though? Simple speak to a trusted, credible an experienced Canadian business financing advisor. ' Good enough ' will soon become best when it comes to sourcing and structuring asset financing that makes sense from a Canadian equipment loan perspective .

P.S. We knew you would never settle for 2nd best!





Stan Prokop - founder of 7 Park Avenue Financial -

http://www.7parkavenuefinancial.com

Originating business financing for Canadian companies , specializing in working capital, cash flow, asset based financing . In business 7 years - has completed in excess of 80 Million $$ of financing for Canadian corporations .Info re: Canadian business financing & contact details :

http://www.7parkavenuefinancial.com/equipment_loan_finance_lease_leasing_financing.html