Often overlooked, equipment sale leasebacks offer significant benefits such as instantly infusing growth capital without taking on new debt. Misperceptions persist about what equipment qualifies for  Equipment Sale Leaseback Financing arrangements – for example, specialized equipment and machinery or titled rolling stock won’t work.

The process starts with your equipment being professionally appraised for fair market value. You then enter into a lease agreement and make lease payments.

Buying Equipment

If you have specialized equipment, machinery, vehicles or other assets on your balance sheet owned free and clear that are sitting idle, consider an equipment sale leaseback. The financing structure allows you to unlock trapped working capital and fund priority projects without taking on new debt.

Typically, an independent finance company will purchase your equipment from you and then lease it back to you for an agreed-upon term. You retain physical possession and normal use of the equipment while you make monthly lease payments, which can be 100% tax deductible as operating expenses.

Contrary to common assumptions, even startups with a less than perfect credit history can qualify for an equipment sale leaseback. Well-structured agreements can optimize tax deductions and align with operational needs and growth goals.

Selling Equipment

Equipment Sale Leaseback Financing is a financing technique that allows you to monetize equipment owned by your company, transferring temporary ownership of the assets to a financing partner (the “lessor”), and then leasing the equipment back for continued use. This can be a great solution to infuse working capital into a company while preserving line of credit and other debt capacity.

Contrary to popular assumptions, a variety of equipment assets can qualify for sale leasebacks. Additionally, the negotiated lease terms can align to your strategic investment goals and operating plans. And despite criticism that sale leasebacks seem expensive, tax and accounting incentives minimize true total capital costs over longer investment horizons.

Financing the Sale

Sale leasebacks are an excellent source of working capital and provide companies with flexibility to meet both short-term financing needs as well as long-term growth objectives. However, it is important for businesses to carefully consider the terms of the lease agreement and operational impacts before committing to such an arrangement.

With equipment sale leaseback financing, you sell your existing equipment to a finance company, which then agrees to lease it back to you for an agreed-upon period of time (Lease Term). You continue to use the equipment as normal while making lease payments.

This arrangement is an alternative to financing through a bank, which can be difficult for many small to mid-market business owners due to credit challenges and regulatory changes. In addition, sale leasebacks offer built-in tax advantages including non-dilutive funding that does not show up as debt and preserves existing line of credit facilities with your bank.

Collateral

Many businesses are surprised to learn that they can quickly pocket cash from equipment they own – vehicles, heavy machinery and other titled assets – with an equipment sale leaseback. This is a faster and more flexible way to receive funding than seeking an outright buyer or applying for loans that often require months to process.

Specialized lease financing firms understand the value of the equipment you’re selling and can offer a flexible range of options on how to use the proceeds. This includes the ability to negotiate lease durations that align equipment usefulness with capital investment horizons. In addition, lease payments are tax deductible to the seller just like interest expense. This allows you to raise money for a variety of priorities including expansion, inventory buffers or refinancing debt.

Taxes

A sale leaseback (SLB) is a financing option that lets businesses unlock the value in their existing equipment without affecting their cash flow. It provides immediate access to capital, improves the balance sheet and offers tax advantages, including accelerated depreciation.

A SLB can also be structured to avoid triggering interest expense and preserve existing credit facilities with the financing partner. It also makes it easier to qualify for Section 179 and bonus depreciation. Lease payments are classified as operating costs and, depending on the structure of the agreement, may be fully deductible.

Unlike a term loan, a sale leaseback does not require financial covenants that may restrict the use of the asset. This gives you more flexibility to meet your operations’ needs and growth plans.

When buying or selling property in Melbourne, hiring a conveyancer is an essential step to ensure the process goes smoothly. However, finding an affordable conveyancer who can provide quality services is crucial to keeping costs down without compromising on expertise. In this article, we explore tips and options for finding an affordable conveyancer in melbourne.

Why You Need a Conveyancer

A conveyancer is a legal professional who handles the legal and administrative aspects of property transactions, including contract review, property searches, and settlement. Their expertise ensures that the transaction complies with all laws and regulations. Engaging a skilled conveyancer helps prevent costly mistakes during the process, which is why finding one who is both affordable and competent is key.

How to Find an Affordable Conveyancer in Melbourne

Get Multiple Quotes
Start by reaching out to several conveyancers to get quotes. The fees for conveyancing can vary depending on the complexity of the transaction and the experience of the conveyancer. By comparing multiple quotes, you can identify affordable options without compromising on service.

Consider Fixed-Fee Services
Many conveyancers offer fixed-fee packages, which can provide a more predictable cost compared to hourly rates. Fixed fees allow you to budget effectively, making it easier to control costs during the transaction.

Look for Online Services
Online conveyancing services can often be more affordable than traditional in-person firms. These services are typically streamlined and offer competitive pricing, making them a great option for straightforward property transactions.

Check Reviews and Testimonials
While affordability is important, ensure the conveyancer is reputable. Look for online reviews or ask for testimonials from previous clients. A good conveyancer will not only offer affordable prices but also have a track record of successfully handling property transactions in Melbourne.

Consider Experience and Specialization
An experienced conveyancer may charge a bit more, but their expertise can save you money in the long run by avoiding mistakes. Some conveyancers specialize in certain types of transactions, so ensure they are well-versed in the specifics of your situation, whether it’s residential or commercial property.

Top Affordable Conveyancers in Melbourne

While there are many affordable conveyancers in Melbourne, it’s important to do thorough research before making a decision. Some firms that are known for offering competitive pricing while maintaining quality service include:

Melbourne Conveyancing – Known for providing clear, affordable services with a focus on residential transactions.

Conveyancing Works – Offers a variety of services at affordable rates, specializing in online conveyancing.

Australia’s Conveyancing – Offers a straightforward and cost-effective approach to property transactions in Melbourne.

Conclusion

Finding an affordable conveyancer in Melbourne doesn’t have to mean sacrificing quality. By getting multiple quotes, considering fixed fees, and looking at online options, you can ensure you get the best deal. Always make sure the conveyancer you choose has a good reputation, relevant experience, and offers services that align with your property transaction needs.