GSE Financing or Leasing, Which Option is the Best?

GSE Financing or Leasing, Which Option is the Best?

In the current tough economic times, it is important for companies to find ways to reduce their cost of spending. Ground support equipment firms have fully embraced gse leasing in an attempt to cut down on operation costs as well as free off some risks. Buying equipment has become an expense affair and some buyers now feel the need to instead engage equipment outsourcing firms. This option is particularly helpful for start-up companies that need plenty of finances to kick off their operations. While appreciating the fact that gse financing has become more accessible, several industry players prefer renting machinery since it doesn’t require huge sums of money.

 

Strict rules of gse financing particularly relating to credit worthiness have forced buyers to shy away from seeking loans to buy GSE equipment. Loan repayments amounts in most cases are substantially higher than lease payment with the latter becoming more popular. You need to research adequately and evaluate your business needs in order to determine if ground support equipment financing option is the best for your company.

 

Businesses that successfully purchase their equipment using financing plans need to have a solid credit history to be considered for loan applications. These financing options don’t make full payments for the purchase and therefore buyers are required to have ready cash for down-payment purposes. The fact that equipment loans must be collateralized has prevented many buyers from coming out to engage financiers to access funds for equipment purchase. Most gse financing companies, however, use the equipment purchased as collateral, but buyers may be required to avail additional loan security assets. As a result of this, some businesses are unable to consider financing and instead settle for gse leasing companies with more flexible requirements.

 

Leasing is considered a smart option particularly for highly computerized and electronic gadgets that become obsolete in short periods of time. Technology is changing on a daily basis and, therefore, its best to avoid purchasing equipment that will not be relevant in the coming years. Industry players currently sourcing their equipment from gse leasing have been saved from the headache of obsolescence. Equipment that is overtaken by technology can simply be substituted with technology complaint machinery once the lease period expires.

 

Business owners who choose leasing over ground support equipment financing in some instances are eligible for special tax reliefs. There are some benefits that can be accrued particularly if tax regulatory bodies allow you to pay less taxable income by deducting lease payments. However, leasing has also its downfalls because you don’t wholly own the equipment and therefore have to abide by certain regulations stipulated in the lease agreement. Failure to determine your needs from the onset could increase costs of the business if you decide to rent equipment for a long time versus purchasing machinery.

 

The best way to evaluate your suitability for gse financing or leasing depends on your business financial capability in terms of current and future cash flow expectations. This can help you to decide the best option.

Titan GSE is YOUR total ground support equipment provider. We can customize any ground support equipment to suit your specifications. 

GSE Financing or Leasing, Which Option is the Best?