Comparing Bank And Leasing Agents For Equipment Lease And Finance Services
Not every business today has the capital to purchase what they need but instead must find the means to finance their purchase, at terms that they can reasonably afford. Which is better though – going through a bank or going through one of the many leasing agencies in the market today? That is what we will explore here, a side by side comparison of getting what you need through a bank or a leasing agent for equipment lease and finance services.
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An Example of Love’s Labor Lost for the Lack of Financing
In 1923, a young man named Edward Leedskalnin, a business minded 26 year old, asked for the hand of 16 year old Agnes Scruffs and was promptly rejected. He moved to the growing area of Homestead, Florida, where he planned to pine away the rest of his life, surrounded by coral, as hard as Agnes’ heart.
For the next 28 years, he used auto parts to carve himself a home out of the coral around his land. The result was a castle, made out of tons of coral and housing twenty different and unique rooms. He built it using only the auto parts as tools, with the same principles of engineering that created the pyramids in Egypt.
He gave tours of his creation in his later years, making a small profit and dedicated it all to the lost Agnes, the only love of his life. If he had searched for an equipment lease and financing services instead, he might have saved himself a decade or so and made more of a profit. The state of Florida still thanks him for his efforts however, and thousands of tourists flock and pass through its nine-ton gates every year to see this found labor of love.
Bank Versus Leasing Agent
The fact is banks will offer a lease finance option for any business needing equipment. The difference between taking that option or choosing to get your finance and leasing through a reputable agency is the interest rate. A bank lends economic growth to an area by supporting expansion in other businesses, but at low risk. Interest rates guarantee that they will money back, no matter what the economic times and that rate will raise or lower your payment, depending on what the economy does.
A leasing agency will not charge interest on most lease equipment agreements, because they understand risk, and have faith in your success. More importantly, by doing so, their customers can come back and lease more equipment, even with an outstanding lease. In terms of equipment lease and finance services, banks will not accept more risk, and that usually means one lease, per customer.