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Finance Lease

Finance leases give businesses the option of borrowing an asset for a fixed period, rather than having to buy it outright. Not only does this overcome the cash flow implications of paying for a new piece of equipment or machinery up front, it also means the issue of asset depreciation is avoided.

A finance company will buy the asset that you require, and allow you to use it exclusively.

Your business pays for the use of the asset through regular instalments, which helps with cash flow management. Meanwhile, to make the finance lease more affordable, the asset finance company claims the capital allowances on the asset. 

At the end of the lease, you can either purchase the asset or the asset finance company will sell it, possibly giving your business a share of the proceeds.

As a commercial finance broker that specialises in asset based finance, we can identify and help your business secure the most suitable finance lease for your requirements. Simply call 0800 9774833 or request a call back to discuss how we can help, or get an instant quote.

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How does a finance lease work?

  1. The asset finance company purchases the asset you require
  2. You lease the asset from them in return for fixed monthly payments, benefiting from exclusive use of the asset while still balancing your cash flow
  3. Once the lease period is over, the asset finance company sells the asset and you may benefit from a share of the proceeds

Finance lease vs operating lease

Operating leases work in a similar way to finance leases, but differ in the level of risk for the funder and the way they manage maintenance or other aspects.

Under a finance lease, the rental payments you pay during the primary lease period would cover the original cost of the asset. After this period is over, the finance company has recovered its investment and the asset can either be sold, or a secondary lease period (often at a lower monthly cost) could be entered into.

In the case of an operating lease, the lease period does not cover the full initial cost of the asset, and the asset finance company takes on the risk that the asset will have the expected residual value at the end of the lease period. This is typically used for assets such as vehicles or construction plant and machinery, as these assets will have residual value.

With a finance lease, the maintenance costs on the asset would be your responsibility. Operating leases, on the other hand, may transfer the liability to the asset finance company to protect you from any unexpected costs and ensure they maintain the longevity of their asset.

Is a finance lease right for my business?

When it comes to using new assets, there are a number of asset finance options available to cater for businesses’ different requirements, which can make it difficult to decide which one works best for you.

As a commercial finance broker, we understand finance leases inside out, and we’re experienced in identifying the right funding and the perfect facility for businesses of all sizes.

We listen to your needs and take them into consideration; especially when introducing the facility and asset finance companies which provide the right options for your business.

Call our team today on 0800 9774833 to find out more, or request a call back here at a more convenient time.

I was very impressed with Hilton-Baird’s attention to detail, especially in ascertaining our exact requirements. Above all else we were most impressed by the personal touch of the person who handled our enquiries. I would definitely recommend Hilton-Baird.

Stewart Morris, Managing Director, Eschol Brooke Enterprises Ltd

Some of the funders we work with

  • Team Factors
  • Aldermore Invoice Finance
  • Regency Factors
  • PNC Business Credit
  • ABN AMRO Commercial Finance
  • iwoca
  • 4Syte
  • Catalyst Finance
  • Woodsford Tradebridge
  • GapCap Cashflow Finance
  • Spotcap
  • Secure Trust Bank
  • Close Brothers Invoice Finance
  • Roma Finance
  • Bibby Financial Services
  • Investec
  • Davenham Asset Finance
  • Giant
  • Partnership Invoice Finance
  • Creative Capital
  • Davenham Trade Finance
  • Ultimate Finance Group
  • Haydock Finance Ltd
  • Metro Bank SME Finance
  • Skipton Business Finance
  • Boost Capital
  • Barclays
  • Calverton Finance
  • Shawbrook Business Credit
  • Nucleus Commercial Finance
  • Royal Bank of Scotland
  • Positive Cashflow Finance
  • Merchant Money
  • Asset Advantage
  • Market Invoice
  • Innovation Finance
  • Trade Finance Partners
  • Santander Corporate & Commercial
  • Pulse Cashflow Finance
  • IGF Invoice Finance
  • Leumi ABL
  • InvoCap
  • Lloyds Bank Commercial Finance
  • 1pm

Authorised and regulated by the Financial Conduct Authority (FCA number 730445)
We are a credit broker and not a lender and offer credit facilities from a panel of lenders

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