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Information on equipment lease financing in Canada. The ability to understand equipment loan basics around cost and structure is a key factor in successfully acquiring new assets
However in leasing finance and equipment leasing some key basic knowledge can put you way ahead of the game. Let’s examine some of those key basics. By ensuring clients have some of the basics under their belt, so to speak, can alleviate their concerns that equipment leasing is complex and technical. It can be, but it doesn’t have to be.
When you are entering into an equipment lease financing transaction you should be aware that you have the ability to enter into one single lease, or, if you choose, you have the option of entering into one master lease. The single lease application in Canada is the most basic form of equipment financing. Utilizing a single form application and lease you should use this form for smaller transaction – a good limit on that size of transaction is 50k and under.
If your firm is a regular leasing prospect and has the ability to source and work with a trusted partner you should consider a Master Lease scenario. This document allows you to acquire future equipment while utilizing the same terms and conditions you have negotiated once up front. That clearly saves you time and some expense, as well as solidifying the relationship with your leasing partner.
You should ensure you understand some of the key points that affect the overall benefit of a solid lease rate, term, and structure. Some of these key points are warranties, how tax is paid and calculated, and your maintenance obligations.
When you enter into a Master lease, which is generally recommended as an investment in future financing, you should understand that your equipment leasing company has immediately gained a significant advantage in that all their competitions doesn’t have such an agreement in place with your firm. For that reason you should ensure you are getting a competitive rate.
In meeting with clients we continually feel they don’t full understand how lease pricing works, as well as how to get the benefit of something that approaches the best possible pricing. The reality is that some key factors totally influence your overall pricing and your ability to present those factors in the best light ultimately leads to successful lease negotiation on the part of your firm, the lessee.
Those factors include you years in business, financings you have in place with other lenders, any references you can provide, as well as on occasion the general credit and financial stability of the owners of your firm. Larger transactions require some due diligence on your financial statements, as well as analysis around historical and projected cash flow – i.e. your ability to repay the equipment lease!
We strongly recommend that clients solicit the help of a trusted, credible and experience equipment leasing advisor who can guide them through the basics of successful lease negotiation, with an emphasis on financial and other benefits that accrue to your firm when you complete a equipment lease financing transaction .
South Sheridan Executive Centre
2910 South Sheridan Way
Suite 301
Oakville, Ontario
L6J 7J8
Office = 905 829 2653
Email = sprokop@7parkavenuefinancial.com
Business financing for Canadian Firms , specializing in working capital, cash flow, asset based financing , Equipment Leasing , franchise finance and Cdn. Tax Credit Finance . Founded 2004 - Completed in excess of 100 Million $ of financing for Canadian corporations .
Stan has had a successful career with some of the world’s largest and most successful corporations.
Prior to founding 7 Park Avenue Financial in 2004 his employers over the last 25 years were, ASHLAND OIL, ( 1977-1980) DIGITAL EQUIPMENT CORPORATION, ( 1980-1990) ) CABLE & WIRELESS PLC,( 1991 -1993) ) AND HEWLETT PACKARD ( 1994-2004 ) He is an expert in Canadian Business Financing.
Stan has over 40 years of business and finance executive experience. He has been recognized as a credit/financial executive for three of the largest technology companies in the world; Hewlett-Packard, Digital Equipment and Cable & Wireless. Stan has had in depth, hands on experience in assessing and evaluating thousands of companies that are seeking financing and expansion. He has been instrumental in helping many companies progress through every phase of financing, mergers & acquisitions, sales and marketing and human resources. Stan has worked with startups and public corporations and has many times established the financial wherewithal of organizations before approving millions of dollars of financing facilities and instruments on behalf of his employers.
Stan Prokop
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