[davep]

Does anyone lease machines or vans?  If so what are the ups and downs of doing so,

Ta. Dave.

[Dave_Lee]

Ive leased a few machines including a Truck Mount in the past and had no problems, however, if you default on payments, not only will they reposses the equipment, but you will still be liable for all costs and outstanding payments due up to the finishing date.
Dave.

[Ken Wainwright]

I seem to recall someone saying that he wouldn't even consider leasing if he wasn't V.A.T. registered.

I've always had concerns (as a one man band) with leasing should I loose my license, have an accident or serious illness. If you borrow to purchase equipment/vehicles, you always have the option of selling them should the brown stuff hit the fan.

I was fortunate in '98 with my illness that I didn't have anything leased. As the months rolled by, I considered selling the van when my savings were almost depleted, but I just about got through it

Safe and happy cleaning
Ken

[Doctor Carpet (Ret'd)]

When borrowing money the lender will usually try and sell protection insurance to repay the monthly liability if you have an accident/illness etc.

A far better approach IMO is to not protect the liability but instead protect your income.

There are various policies around which will pay out a guaranteed level of income until if neccessary your chosen retirement date. This means that it will cover lease payments and continue to pay out even when the lease agreement has come to an end.

It's not neccessarily for everybody and can be considerably more expensive, but there again that is the nature of insurance; for example the only way to win on life insurance is to die!!

[mark_roberts]

I was told that leasing is best for larger businesses with many vans as it controls their costs.

For one van esp an owner operator its best to buy as its cheaper and also for the above reasons.

A leasing company told me that.

Mark

[Steve Chapman]

One good thing about leasing is that it is 100% tax deductable as it's seen as a renting expense, where as buying the equipment is not , you can claim the capital gains/charge on it which diminishes slowly
 over time

regards
steve

[stu_thomson]

I was sold the idea of leasing a carpet cleaner 3 years ago as 100% tax deductable and at the end of the agreement the machine is yours for a nominal sum which i was told would be about £50. Im now at the end of my leasing agreement and ive terminated my agreement with the finance firm, last payment was supposed to be dec, but they took one out in jan (still waiting for cheque ) back after arguments on phone that they had made a mistake!
 Had a call from the leasing firm today saying they want 2 months payments to transfer ownership of machine to me (nearly £200 )
 Im currently arguing the cost at mo but he says its normally 3 months  so hes doing me a good deal. If I dont want it ive got to send it back to them in good working order which it isnt at mo and they are miles away and I also want to obviously keep the machine.
  Seems to me that leasing is a bit of a rip off and you are better off with a bank loan as this is also deductable.
If you are going to lease check the small print and get in writing how much that dreaded final payment is

stu

[Dave_Lee]

With my last lease agreement, I was told that the transfer to me would cost one months normal rental £372.. After I argued that the previous three leases I had, had with them it was only £50, they reduced it as a special favour to £100.., which I paid. Thing was with the other three agreements I told them I wanted the release fee amount in writing. which they duly supplied, however I didnt bother with the last one.
Dave.

[stu_thomson]

seems to me they can just pluck an amount out of a hat and hope muggins pays it, I wonder if i stuck to my guns and said i aint paying and i aint going to bring it back to you, what would they say and how would i stand legally as its not in their small print there is an amount to pay at the end.

stu

[Joe H]

Stu - are you saying its NOT in the agreement you signed at the beginning that you pay a sum at the end of term to receive ownership?

[Ian Gourlay]

Ive been told the advantage of leasing is it keeps other avenues open to you if you require other loans.


This sounds very good when a convincing salesman tells you this.

But usually when you take out a loan they ask you your other commitments .

In theory once you hit  your personalborring limit thats it no matter what the source

[Phillip Mold]

"But usually when you take out a loan they ask you your other commitments "

But a lease is not a loan !

[stu_thomson]

Joe, Thats right havnt gone all threw small print but there is definately no amount mentioned as a final ownership payment and the leasing company say there isnt anything written down, its just their policy to charge 3 payments and its yours but they are saying they are doing me a favour and only charging me 2.
They rang me again today hassle-ing me and they are sticking to their guns and so am I, have spoken to supplier who use leasing firm and they are going to speak to them to try ang get figure down if not they will threaten to stop using them, will see what happens next....

stu

[Doctor Carpet (Ret'd)]

You're right when finance companies look at your overall monthly committments when considering further liabilities.

Leasing is an off-balance sheet committment wheras a loan is on-balance sheet, thus influencing the perceived strength of your company.