types of assets funded
Any assets used in a business can be financed. We have funded a diverse range of assets for our clients for the last quarter of a century. We have seen huge leaps in technology in that time. If in doubt get in touch and we will confirm that we can help.
Asset finance usually falls within one of the two categories – hard asset or soft asset.
what is a hard asset?
“Hard asset” finance describes the finance of assets such as plant, machinery and vehicles that are more “solid” and have a residual value at the end of the term.
As there is more security in the equipment, lower rates are usually available.
In the case of lease rather than hire purchase agreements there can be more complicated end of term arrangements. This is because there is a “worth” on the funder’s balance sheet at the end of the lease. They have to be seen to dispose of the asset for fair market value.
However as the lease is what is called a “full payout” lease they will allow the client to act as an agent for the sale and retain 95% of the sale proceeds.
Subject to credit approval, Focus can also offer simpler end of lease options; just ask for more information
what is a soft asset?
“Soft asset” finance is used to describe the finance of equipment that is of an insignificant value at the end of the finance term.
In the case of a lease, the funder can therefore dispose of the equipment to us for a nominal sum and we can make arrangements to suit our client.
The rates in this type of finance are usually higher than “hard asset” finance but retention at the end of the lease is very simple.