The Benefits of an ELGA equipment lease

Nearly any capital asset can be acquired through a lease. The common thread in each of these benefits below is flexibility. Lease payments and terms may be structured based on a business' particular need. When leasing, businesses receive multiple benefits that traditional financing simply can't match:

Leasing provides total financing. Generally no down payments are required, and lessees pay no extraneous tax, delivery, warranty, or other miscellaneous costs. All costs associated with a purchase can be included in the lease, including delivery and installation.

Leasing conserves working capital. Leasing leaves lines of credit at other financial institutions free for cash-flow purposes, investments, unsecured loans, or unexpected emergencies.

Leasing overcomes budget limitations. Most companies are hampered by capital budget limitations from time to time. Leasing allows a business to acquire new equipment with easily affordable rental payments.

Leasing provides security against equipment obsolescence. Upgrade and trade-in options can easily be added to a lease agreement. In addition, there are no risks of equipment ownership, and lessees will never be required to resell or remarket obsolete equipment.

Leasing can offer tax savings. When properly structured, monthly lease payments may be fully tax deductible as an operating expense. This savings results in a lower after-tax equipment cost. Contact us to discuss tax advantages applicable to your specific situation.

Payments are a fixed cost. Monthly lease payments remain the same for the life of the lease, even if interest rates do not.

Leasing provides a faster return on investment. Revenues or savings created as a result of the equipment during the first month often will be in excess of the monthly lease payment, thereby providing an immediate return on investment.

Eligible Equipment Types

ELGA leases a wide range of equipment used in business and industry. In addition to the equipment, lease transactions often include installation and other related costs (such as software) to provide you with one easy to manage monthly payment. You select the equipment and supplier; we provide the financing.

Equipment we Lease:

ELGA leases the following equipment types

  • Agricultural
  • Aircraft
  • Alternate Energy
  • Automobile
  • Broadcast
  • Buses
  • Cables
  • Communications
  • Computers
  • Construction
  • Cranes
  • Electronic
  • Emergency Vehicle
  • Energy
  • Furniture
  • Gaming
  • Graphic Arts
  • Industrial
  • Intermodal
  • Machine Tool
  • Mailroom
  • Marine
  • Material Handling
  • Medical
  • Mining
  • Office
  • Point of Sales
  • Printing
  • Rail
  • Recreation
  • Recycling
  • Restaurant
  • Satellite
  • Software
  • Telecommunications
  • Trucking
  • Utility
  • Video
  • Waste Removal
  • And much more

Frequently Asked Leasing questions

What is the interest rate on a lease?

The amounts charged on an equipment lease are calculated using monthly "rental rates", rather than by using a compound interest rate method that is normally associated with conventional loans. Rental rates are based on the lessor's ability to effectively manage risk and costs associated with equipment ownership, while passing on the economic savings to the lessee.

May the equipment be returned at anytime?

No, the lease is a non-cancelable agreement for a specified term that you or your customer selects at the beginning of the lease. Leases are available for terms ranging from 12 to 120 months (depending on equipment type) and can be upgraded or added on.

What are the options at the end of the lease?

A lease can be structured so that the end user/lessee may purchase the equipment for its then fair market value (or another other amount if previously agreed to in writing), continue to lease, or return the equipment with no further obligation.

Who is responsible for taxes?

Because an equipment lease is a "net" lease, the end user/lessee is responsible for taxes. ELGA is required by law to collect all applicable sales, use and property taxes and remit them to each state.

Who insures the equipment?

Because an equipment lease is a "net lease," the end user/lessee is responsible for equipment insurance.

How does the equipment warranty work on an equipment lease?

ELGA passes through all manufacturer warranty coverage to the lessee. Warranty claims are processed for the lessee in the same way they would be if the lessee were the owner of the equipment.

May non-equipment items such as software and maintenance be included?

Yes! One of the many benefits of leasing is that you are able to "bundle" a number of products into a lease, including equipment, software, installation, and taxes. This way, a lessee can make one simple monthly payment for an entire system or equipment line, with considerations like maintenence and support included.

Lease Structures Available

A Typical ELGA Equipment Lease has a term from 12-60 months, and is arranged under one of the following structures, chosen by the lessee:

Fair Market Value Lease

Also known as a "true" lease, this option is ideal for businesses that want to pay only for the use of equipment, not owning it. Fair market value, or "FMV," leases may also provide important tax benefits over other alternatives. Plus, FMV leases have the lowest monthly payments as compared to any other lease type.

10% Purchase Agreement Lease

For businesses wanting the features of a $101 purchase option lease but desire the lowest monthly payment, the 10% purchase agreement lease is the right choice. The lease includes a fixed cost at the end of the lease equal to 10% of the original acquisition price, which results in a lower payment. At the end of the lease, lessees may purchase the equipment, renew the lease, or upgrade to new equipment.

$101 Purchase Option Lease

For businesses looking to own new technology or equipment, we offer a $101 purchase option lease. Lessees choosing this option may treat the lease as a capital purchase and deduct depreciation and interest costs for tax purposes.

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