Asset Finance

Asset finance is beneficial for businesses who might not have that much spare cash, but need a quick and easy solution in order to secure equipment for their business without breaking the bank. To buy equipment outright might be a strain on finances, but asset finance can lend you the cash for important purchases quickly and easily with an agreed repayment term and an affordable monthly cost.

It’s often easier to obtain asset finance than other types of finance solution, so it could be the option for you. The fixed instalment plan is also a beneficial factor of asset finance as it allows you to manage cash flow and organise your monthly outgoings.

At AJL Finance, we offer both finance lease and hire purchase options. Finance lease means that the cost and VAT are spread across the payment term and then the equipment is given back at the end of this term. Hire purchase is where the VAT is paid upfront, the equipment can be bought for a one-off payment at the end of the term.

We also offer sale and leaseback options, where an asset that has been purchased within the last three months and is finance free is sold to a funder, and then your business can lease it back at a monthly fixed cost. As well as this, we can help you with asset re-finance, wherein your business can free up equity held in high-value fixed assets, such as equipment or machinery.

What is asset finance?

Asset finance is a class of finance products for firms that need to acquire physical assets, like vehicles, machinery, and other high-value equipment. For instance, it can serve as an unsecured transport business loan when a company with a fleet needs to obtain additional vehicles.

With asset finance, the asset being acquired is used as collateral for a lease or loan, so businesses get immediate access to and use of the vehicle or equipment item. Rather than making a large payment upfront, the firm makes regular repayments over time to help maintain its cash flow and spreading the cost of an expensive asset. Among the most common asset finance types are leasing and hire-purchase, which allow enterprises to use the asset for a fixed term without tying up substantial capital they require to run.

Types of asset finance we provide

Here at AJL Finance, we offer a range of different asset finance types to suit the individual needs of businesses. These include leases, hire purchase (HP) and sale and leaseback.

Lease

A long-term finance option, a lease involves a leasing company buying an asset and leasing it to a business for a fixed term in exchange for monthly payments. It works like hire purchase or a long-term loan, but with no upfront costs of purchasing the asset. When the lease ends, the firm can choose to sell the asset and retain a share of the sale proceeds, hand the asset back or extend the lease for a second rental period.

Hire purchase

In Hire Purchase (HP) asset finance, a lender purchases an asset on behalf of a business and lets it use it by making regular payments for an agreed term, with an option to buy the asset outright when all payments are made. Businesses can use the asset immediately, but become its legal owner after the full cost, plus interest, is paid.

Sale and leaseback

Finally, sale and leaseback is an asset finance option where a firm sells an asset to a buyer and leases it back from them immediately. This transaction lets the enterprise access the capital that is tied up in the asset, but allows it to keep using it. Sale and leaseback finance gives the company a cash injection without it losing the advantage of having the asset.

Here at AJL Finance, can offer flexible repayment terms, rates and loan amounts. Get in touch by filling in the form and be on the way to giving your business a boost.