Loan vs. Lease, Why Lease from Action Auto
Loan vs. Lease: Why Lease from Action Auto Sales and Leasing
Comparing a loan to a lease is like comparing mountains and lakes. Let's have a quick look at some basic differences between a loan purchase and a lease.
A loan is designed for your business to own equipment as a depreciating asset. On the other hand, a lease is usually designed for your business to acquire the equipment by renting it over a specific agreed term. By renting equipment, it may provide some important tax advantages depending on your business.
Commercial auto leasing can provide your business with the option to own the equipment at the end of lease with an end of lease buy out. Depending on the type of loan you business acquires, the loan rate may be fixed or variable and the terms repayment and penalties of cancellation vary.
A lease rate is typically always fixed and the repayment terms and penalties of cancellation also vary. The customers or lessee should always review their specific lease agreement for full details. While commercial auto lease terms will vary, there are generally some additional penalties for early cancellation. For further information please contact one of our leasing agents.
Will your bank really provide better value?
Many businesses assume their bank offers low interest rates. With many banks offering businesses low interest rates for loans, or government assist business loan rates of Prime + 3% plus and additional bank fee of 2%, as a business owner you need to question the real value.
Commercial vehicle lease rates are very competitive. Pricing will always be on approved credit and on the customer's credit and financial history. With banks they need assets to secure a commercial business loan. With leasing we are secured with a properly structured lease agreement on the asset you are acquiring.
Action Auto Sales not waste your time and unlike others, we don't charge any application fees. Apply online and in as little as 24 hours we'll review your credit application and respond back to you.
Our Commercial Financing Program
With the discussion of conventional commercial business loans having many stipulations, we should touch on the fact that our in-house commercial financing program is very advantageous for many of our customers.
The first thing we should touch on is that we do it here at the dealership (one less step for the busy business owner). Secondly, the rates are historically low. Seeing such low fixed rates may make budgeting easier. Thirdly, no collateral will need to be secured to obtain the loan. Fourthly, if the business has been operating for a specified length of time by the bank, the loan can be obtained on the credit of the business