Benefits of using Asset Finance
Here at Touch, we’ve helped hundreds of businesses secure the right funding over the years. We recognise that taking out asset finance can be a stressful time, which is why you need the right advice and support. Here are some of the advantages and disadvantages of taking out asset finance:
Peace of mind
Asset finance is a medium term finance facility which, provided you keep the repayments up, cannot be withdrawn by the lender. This means that you can be confident the asset will available for the agreed period, unlike some facilities, such as bank overdraft, which can be withdrawn at short notice.
Forecasting Cash flow
With the regular nature of payments and them usually being a set amount you can better forecast your cash flow. In some instances you can also see a direct correlation between the revenue generated by the asset and the cost of the repayments.
Fixed Rate Financing
In most cases the interest rate charged by the lender is a fixed percentage which means the monthly repayments hardly change. This is good in times of low interest rates but can quickly become expensive if interest rates start to drop.
Tax Advantages
Both hire purchase and leasing agreements give small to medium sized organisations the opportunity to benefit from capital allowances. Using hire purchase you can gain capital allowance if you’re in a profitable position.
