Equipment finance options for start ups

Equipment finance is a smart and cost effective way to acquire the equipment your business needs to operate. Read on for some advice on the different equipment finance options available for start ups.

Asset lease
An asset lease allows you to have the use of business assets and enjoy the benefits of ownership, while the finance company retains actual ownership of the equipment. In return you pay a fixed monthly rental amount for the duration of the lease. At the end of the contract you can purchase the equipment, sell it or continue the lease.

Commercial Hire Purchase
With a commercial hire purchase arrangement business equipment is hired from a finance company for a fixed monthly repayment fee for a specified period of time. The equipment is bought by the finance company and then hired out to your business. You have use of the asset but do not own it.

Chattel Mortgage
A chattel mortgage works in much the same way as a home mortgage. It provides you with immediate ownership of the asset in return for a charge paid to the finance company until owned outright or the term of the loan expires. This facility also allows you to claim back the tax on the purchase price of the equipment.

Equipment Rental
This option is a contract between your business and the finance company to rent the equipment for a fixed period. Interest rates are fixed and the costs are known in advance.