Is Finance Lease right for your business?

posted on 06/07/2023
  • Overview
  • What is Finance Lease?
  • Pros and Cons
  • Implementing Finance Lease

Deciding how to finance your fleet is a crucial decision with long-term implications. The right choice can provide you with considerable cost savings and operational efficiencies, while the wrong one could lead to unexpected expenses and complications. 

One option is Finance Lease. It offers a balance of control and flexibility, potentially making it an attractive choice for your fleet. In this blog, we’ll explore what Finance Lease is, how it works, its pros and cons, and how Alphabet can guide you in making the best choice for your fleet.

What is Finance Lease?

Finance Lease allows you to lease a vehicle with the added benefit of it sitting on your balance sheet. It also gives you the potential to profit from the proceeds of selling the vehicle when the contract ends. 

How does it work?

Similar to Contract Hire, in a Finance Lease agreement, the leasing company retains ownership of the vehicle, while you pay regular instalments to use it over a predetermined period.

However, unlike Contract Hire, Finance Lease agreement allows the vehicles to sit on your company's balance sheet, offering potential tax advantages.

And at the end of the lease term, you can do one of two things:

  • Sell the vehicle to a third party and retain any balance of profits (minus a final balloon payment), or 
  • make the balloon payment and continue using the vehicle under a set rental agreement.

The pros and cons of Finance Lease

Opting for Finance Lease comes with benefits, but it also carries some considerations you should be aware of before making a decision.

Ready to explore if Finance Lease is the right fit for your fleet?

Reach out to Alphabet today. Our expert team is here to answer your questions, guide you through the process, and help you discover the fleet funding solution best suited to your business. 

Implementing Finance Lease for your fleet

When it comes to choosing the right fleet funding for your business, Alphabet is ready to help. We offer a range of fleet funding options, including Finance Lease, to ensure your choice aligns perfectly with your business needs.

Our team of experts is committed to helping you navigate Finance Lease agreements. We offer advice tailored to your situation, covering everything from adjusting balloon payments to maximising your fleet's value. Plus, with our extensive industry network, we can help you secure premium vehicles for your fleet. 

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