Asset Finance Explained1st August 2015
The term asset finance encompasses a wide range of loan products, all concerning physical assets – machinery, equipment, vehicles, and any other physical equipment a business needs to function. Broadly speaking, asset finance can be broken into three categories:
Method of acquiring physical assets without paying for them outright. When leasing an object, a business will make monthly payments, including interest, until the terms of the lease are up.
Involves the same monthly payment structure as leases, but those monthly payments will add up to the full cost of the asset, meaning that the business will own the asset once the hire purchase term has ended.
Method of using assets a business already has to obtain funding, where a lending institution will advance cash to a business based on the value of the asset.
Each of the many types of asset finance is available from the wide range of lenders on Rangewell’s extensive market map of SME lending options. Rangewell provides personalised finance solutions to SMEs seeking funding and allows accountants to offer their clients the funding options that best suit their unique needs – always free of charge to qualified accountants.
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