Leasing

Relationship-Based Leasing from Your Bank

When you need new equipment, facilities, or vehicles to make your business operate better, sometimes buying is not the best option. The popularity and growth of leasing is in large part due to the wide variety of available lease options. These include 100% Financing: No Down Payment Required, New or Used Equipment, Variable Payment for Seasonal Customers, and Fixed Rate for the Lease Term.

Businesses today can get all their equipment leasing needs met at their local bank. Our leases are relationship-based, not transaction-based. No longer are there large fees and penalties around each corner. Businesses are treated fairly.

Leasing through your local bank makes sense. Local banks are at the forefront of providing businesses with capital to grow and expand. Leasing builds on our commitment to provide you with the financial tools you need to succeed. 80% of all businesses use equipment leasing today to acquire equipment, and almost any type of equipment qualifies for a lease. If your business is considering a lease for equipment, talk to a commercial lender about the common sense options available.

Want to discuss how leasing can impact your business? Contact our Commercial Banking team for more information on leasing or call (855) 256-7328.


 

Features & Benefits of Leasing

There are many benefits to leasing through Lake Ridge Bank. We know you, and we know your business. We already have an established, trusted business relationship, and we understand your objectives when you lease. The real advantage is our partnership.

Partnership Perks

Unlike other traditional leasing companies, we never charge termination or prepayment penalties should you need flexibility during the term of your lease. In addition, coordinating all your banking and financing activity with one bank saves you valuable time. 

Financial Benefits

Get the full value of the equipment without the full price, take advantage of timely deals & reduced maintenance costs, customized payment schedules to match cash flow patterns, and balance sheet improvements.

Tax Advantages 

Expense deduction benefits and Extra benefit for year-end acquisitions due to IRS depreciation deduction rules.*

Accordion Feature

Only from your local bank: We offer an accordion feature that allows for an increase or decrease in payment during the lease term depending on need for tax shelter. 

Tax Lease vs. Capital Lease

A tax lease is structured to provide the leasing company with equipment ownership, and along with it all depreciation benefits. In return, your lease payments may be fully deductible. The documentation for a tax lease is designed to conform to all related guidelines.

A capital lease, also known as a finance lease, is structured to pass all ownership benefits to you including depreciation. Only the interest portion of your lease payment is deductible, along with your depreciation expense. Such leases commonly have a $1.00 purchase option at expiration.

For counsel and guidance, we recommend you discuss your specific situation with your tax advisor to assess which lease best fits your needs.

FAQs

Reference our frequently asked questions below. Still need help? Contact us online or chat with us!

For transportation equipment, Lake Ridge Bank Leasing charges a remarketing fee based on a Terminal Rental Adjustment Clause (TRAC). Otherwise, there are no fees charged at lease end, provided the equipment is returned in the condition as stated in the lease.

Simply notify us 90 days prior to the end of the lease term (or as indicated in the lease documents) that you will be returning the equipment. You should inspect the equipment to ensure that its condition is the same as when the lease was initiated, excepting normal wear and tear, and make any necessary repairs. Then, simply deliver the equipment to a specified location.

At the end of the lease, you can purchase the equipment, return it, or renew the lease. All Lake Ridge Bank leases have end-of-lease purchase options, which vary depending on the type of equipment.

We handle changes and early terminations on a case-by-case basis. A Lake Ridge Bank lease is non-cancellable; therefore, you are fully obligated to make all payments under the lease over the entire lease term. However, we will work with you to make changes and terminations that your business requires.

Generally, you are responsible for the lease payment plus operating costs, such as maintenance, sales and property taxes, license, registration, and insurance. There is occasionally a special usage fee built into the lease for certain types of equipment. This usage fee is agreed upon with our customer at the beginning of the lease term.

Yes, in fact, the ability to easily upgrade equipment is one of the major business advantages of leasing. With a Lake Ridge Bank lease, you can set up a new contract to meet any upgrade needs. One or more of the components of the lease may be adjusted including term, residual, and rental payment to account for the cost of the upgrade and the additional life of the upgraded leased asset.

You are obligated to pay the rentals in a lease, and must pay all taxes, insurance premiums and maintenance costs related to the equipment, throughout the term of the lease.

Lake Ridge Bank Leasing solutions offer one-source specification and pricing comparisons, volume purchasing discounts, equipment protection and selection assistance on transportation and material handling equipment.

Virtually any type of equipment, vehicles or facilities used by your organization my be leased. You can choose any make or model, new or used, available through any vendor.

Rather than loaning you money to buy a piece of equipment, a leasing company lends the use of equipment or machinery and you pay a periodic lease rental or payment. In essence, you only pay a usage fee for the equipment as it is used rather than paying interest on a loan. Finally, you typically treat a lease differently for accounting and tax purposes.

Banknotes & Resources

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*IRS TAX GUIDELINES: The IRS isn’t specific on what differentiates a true lease from a conditional sale. Each case is decided based on its own circumstances. Generally, a transaction is considered a true lease if you follow a few simple guidelines. The following points are not necessarily a comprehensive listing of IRS guidelines for leasing, but will provide a general idea of the areas looked at in determining whether a transaction is a lease rather than a conditional sale.

  • The term of the lease shouldn’t be longer than the property’s economic life
  • Your lease payments can only amortize the value of the equipment that is actually used, not necessarily its total value. The leasing company needs to demonstrate an appropriate level of risk for the property from the beginning to the end of the lease
  • If you decide to buy the equipment at the end of the lease, you can’t pay less than its fair market value
  • The leasing company must expect a financial return from the lease beyond the inherent tax benefits of ownership
  • You may not loan the leasing company the funds or guarantee the debt used to acquire the leased equipment