Arranging asset finance through Luna Finance allows you to plan for the future with fixed payments. We can help you to manage your cash flow more effectively and efficiently, whilst having access to the assets needed to grow your business.
What is asset finance?
In order for businesses to grow, they often need to invest in new assets or equipment. Asset finance is a lending option for organisations which require new equipment but don’t immediately have the funds. This type of finance can help businesses to purchase essential assets such as equipment, machinery, vehicles, and technology. Typically this finance method involves paying for the use of the asset in regular instalments over an agreed time period.
You might not be in a position to purchase the asset now but can if you can make payments over monthly instalments. In order to help, asset finance with Luna Finance gives you the equipment you need to grow your business right away.
Why consider asset finance with Luna Finance?
Asset finance can help fund almost any type of asset, allowing you to obtain equipment in an affordable, risk-free manner. At Luna Finance we understand the need for you to grow your business in a way that suits your financial capability. We know that not having access to certain assets can put the future of your company at risk or cause uncertainty.
Types of asset finance
A finance lease is where you rent an asset for the duration of its economic lifetime. The lender will own the asset and you will pay its full value in monthly instalments – with interest added – in order to use it. Unlike other finance options, with a finance lease, it’s unlikely you will need to put down a deposit.
Benefits of a finance lease
With contract hire, you will only pay the depreciation value of the asset, not the full amount. However, at the end of the contract, the asset should be worth the value agreed upon when the contract was taken out. This means there might be additional maintenance costs to consider.
Benefits of contract hire
Hire purchase (HP)
Also referred to as ‘HP’. The key difference with HP finance compared to leasing options is at the end of the agreement your business will have full ownership of the asset. You will pay for the asset in monthly instalments with added interest and will usually be required to put down a 10-20% deposit.
Benefits of hire purchase (HP)
This is a hire purchase agreement but an amount of capital (residual value) is offset until the contract ends. This reduces the monthly payments but you must settle the lump sum at the end of the term.