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Why Has My Equipment Leasing Company Turned Me Down For Credit?

If you are an SME or start up business that needs to find smart ways of financing your business plans, you may well be hoping to set up a lease agreement to fund the acquisition of essential equipment. Or perhaps leasing to fit out your office or upgrade your IT systems.

So what can you do if you find out you have been turned down for leasing by a particular leasing company?

The first thing to do is find out why.  Leasing companies are under no obligation to provide an explanation as to why a leasing application has been refused, and they made refuse to do so for commercial reasons. Reasons why include:

  • They are fully committed, i.e. they have some leases with you already and do not want to extend the facility
  • You have missed some payments with them
  • You have not been trading long enough
  • Your accounts are showing a downward trend
  • Poor liquidity on your accounts
  • Accounts not filed on time
  • They do not ‘like’ the sector – retail, construction and recruitment companies inparticular suffered due to this in the recent recession
  • They do not ‘like’ the equipment – photocopiers, telecommunication equipment or construction equipment
  • The supplier is not strong enough
  • Your credit rating is poor
  • You have bankrupt companies against your name
  • Your location
  • The amount to be financed is too high compared to the company balance sheet
  • And many more reasons…
Next steps if turned down for credit by a leasing company

Sometimes, if you have been turned down for credit, you can appeal the decision and/or provide more information. More often than not, the finance company will stick to its original decision: while a Credit Manager does not get fired for rejecting your credit application, he or she may get in trouble for an acceptance that goes wrong!

Try, however,  to find out what the key reason(s) are. They may be simple to fix. For example, if the finance company is fully committed you can simply approach another leasing company. If the leasing company does not like your chosen supplier, you can, of course, change the supplier.  Should your accounts show a downward trend it may be that you can offer management accounts and bank statements that indicate a recent improvement?  If you have not been trading long enough, are you in a position to offer a personal guarantee, or maybe provide a larger deposit?

It is always better to provide as much data as you can. Credit analysts have to look through many deals every day and they tend to make decisions quickly, especially where there is limited information.  A well written proposal will make your credit application stand out.

This is where your leasing broker comes in. A good leasing company can package up information in a way that the funder finds most acceptable.  Where the job of finding a credit facility falls on the shoulders of the supplier, especially in sectors such as photocopiers, you may find that they do not have the technical expertise to package a lease deal up and send it to a leasing company.

So in summary, if you find yourself turned down for leasing…

  1. If possible, find out why you have been declined
  2. Provide as much positive information as you can
  3. Change your proposal to make it more interesting
  4. Contact  another leasing company

For more information about obtaining a leasing deal please contact WestWon on Tel: 01494 611 456. Alternatively, you can download our free Guide To Leasing.

Entrepreneurial Epoq IT Signs Partnership Deal With WestWon Leasing Company

Award winning IT Service Provider, Epoq IT, has signed up to the WestWon Partner Leasing Programme in a move that underlines the leasing company’s growing dominance within the IT Sector. As a result, the innovative IT reseller can now offer its customers instant lease quotes as a tax-efficient method of payment for their hardware, software and IT service needs.

Leasing For IT Hardware, Software and Services

Gary Swanwick from Epoq IT commented, “We see the formalisation of our relationship with WestWon as a very positive move for our business, and we are excited to be able to offer very attractive leasing options backed by the expertise and service of a leading leasing company in the sector.

“Since joining forces with WestWon, we have already written a number of leasing deals, with one customer alone having leased IT hardware, software and services totalling more than £70,000.  We are also delighted to be in line to become one of the first resellers to benefit from WestWon’s new ‘Online Leasing Shop’ – due to be launched in Spring 2014.” Gary concluded.

According to WestWon’s Sales Director Andy McCready, “As the winner of Small Business of the Year award 2013, and with Managing Director, Gary Swanwick, having won the award for Entrepreneur of the Year 2013, Epoq IT is a perfect fit for the type of forward-looking organisation that WestWon is delighted to welcome onto the WestWon Partner Programme; and we anticipate a highly successful year working together in 2014.”

IT Leasing Partner Benefits

Working in partnership with WestWon enables resellers such as Epoq IT to offer a range of flexible, tailored finance solutions so that customers can invest in the equipment and technology they need right away, and crucially in the IT arena, upgrade more easily to avoid future technology obsolescence.

WestWon provides a range of support options for reseller partners, who wish to offer their customers a finance option, including

  • Instant quotes and highly competitive rates via the WestWon Partner Portal
  • Dedicated WestWon Account Manager to help you grow your business
  •  Branded finance portals for authorised WestWon partners
  •  Finance partner logo and plaque
  • Sales training and marketing support

 

For more information, contact WestWon on Tel: 01494 611 456 or see http://oldwestwon.wpengine.com/home-page/resellers/

Even The Office Kitchen Sink Can Be Leased For Business

What can you lease for business? Did you know that organisations both large and small – well-established and even new start SMEs too – can lease almost any type of business equipment, hardware, software, office furniture and fit outs, not to mention moving premises and machinery? In fact, if you can name it, you can probably find a food lease option for it too … yes, including the staff room kitchen sink! You simply chose the equipment you need to grow your business and the leasing company – like WestWon leasing –  provides the asset funding.

5 Key benefits of leasing for business
  1. Lease payments can be set against profit, thereby potentially reducing tax bills.
  2. Flexibility and cash flow boost: you can obtain the business equipment and technology you need without tying up available cash and lines of credit.
  3. Your business can also get an instant Return on Investment as once you make a set initial payment, you can acquire and start using the asset immediately, while spreading payments over the useful life of the equipment.
  4. Flexible repayments: lease payments can be tailored to match seasonal cash flow. You can also choose a fixed interest rate, which protects against interest rate rises and enables you to plan your budget effectively.
  5. Avoidance of equipment obsolescence and easier upgrades in the future: increasingly vital as more and more businesses are becoming technology-driven.
Which Business Sectors Use Lease Finance?

Most if not all business sectors use asset-based finance as part of their financial planning. We regularly arrange lease finance agreements for organisations requiring:

 

WestWon is a leading UK leasing company completely independent of any supplier or manufacturer, you can choose any combination of equipment and technology you require for your lease agreement. WestWon is also happy to help recommend suppliers if you don’t have one in mind.

For more information about how leasing versus buying can work hard for your business, contact WestWon on Tel: 01494 611 456.

 

3 Key Facts About Leasing Equipment For Business

Whether you are a new start business, an SME or a large company, you may find yourself thinking about leasing equipment, machinery or office furniture, fit outs and moves for the first time. Perhaps you have moved companies, taken on a new role within your existing company or are simply expanding fast and wish to safeguard your all important cash flow. Whatever the circumstances, here are 3 useful things that you should know about leasing…

How does leasing work?

When you enter a lease agreement, the contract is between your business and the leasing company. Simply select the equipment you require and agree the price with your chosen supplier. A lease agreement is then drawn up by the leasing company.

Once the lease documents have been signed and returned, arrangements will be made for the supplier to deliver the equipment. On receipt, you sign a ‘certificate of acceptance’, which effectively states that you have received and are happy with the equipment. The leasing company then pays the supplier. You pay the company (the lessor) a regular rental payment, typically across two to five years.

What does it cost to lease equipment?

The rental is calculated by adding the equipment price after the Residual Value has been deducted, plus the interest due over the term of the agreement. The interest will depend on the amount you finance, the term of the agreement and frequency of repayments. It works just like a mortgage – the shorter the term, the less interest paid.

How to choose a leasing company

Selecting the right company to work with is vital. As with entering into any new contract, when opting to lease equipment it is important to choose a reputable leasing partner. A recent BBC Panorama documentary highlighted the need to diligently check the credentials of any company you may wish to deal with. Remember to always choose a leasing company who is a member of industry bodies such as the FLA (www.fla.org.uk) and NACFB (www.nacfb.org), which ensure best practice. Members of the NACFB operate under an Office of Fair Trading registered Code of Practice.

For more information about all aspects of leasing, please contact WestWon on Tel: 01494 611 456. You can also download a free guide to Financing Your Business Plans with Leasing HERE.