Financial and Operating Lease
Leasing
KF&E provides medium-term financing services for clients in order to lease commercial and industrial equipment/machinery for a minimum term of 36 months.
Benefits
- Financial Statements
- Helps Maintain Debt to Equity ratio
- Improves Return on Assets (ROA)
- Does not Conflict with Company Covenants
- Leasing costs are tax deductible
- No gains nor losses are incurred due to the acquisition of properties
- Cashflow
- No large upfront capital investment is needed, thus not affecting the liquidity of the business
- Finacing amount can be in full value of the asset.(in some cases)
- Tax
- Leasing costs are allowed higher tax deductions than depreciation.
- Technology
- Risk hedging against obsolete property is available
- Technology upgrade option available
Leasing Conditions
- Leasing period
- Leased properties
- All types of capital assets, i.e., machinery for metal, wood or plastic work, transportation vehicles, office equipment, etc
- Leasing Expense
- Fixed rate throughout the leasing term
- Collateral
- Personal guarantee and a lien on the machinery/asset registered as collateral
- Leasing Finance Limit
- 70-100 percent of property value, set only once at inception
- Approval period
- One week (upon receipt of all required documents)
- Payment of leasing installments
- Monthly payments of equal fixed amount
Eligibility
- Must be limited liability company or limited partnership