4 Things You Probably Didn’t Know About Equipment Leasing and Financing - Douglas Lake Equipment & Avenue Machinery
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4 Things You Probably Didn’t Know About Equipment Leasing and Financing

By Kyle Winterbottom

Equipment is not cheap. Don’t get me wrong, it’s definitely worth the money, but I think we can all agree that it’s not something that most of us have the capital to plunk down and purchase an entire excavator outright.

That leaves most buyers with either financing or leasing as options to acquire equipment. However, leasing or financing equipment is not exactly the same as leasing or financing automobiles – typically the only other large purchase where the public would be faced with this option – it’s actually much more flexible.  

In my tenure at Douglas Lake Equipment, I’ve provided customers countless options on financing and leasing that they didn’t know even existed.

Here are the 4 of the most common things that customers weren’t aware of when leasing or financing equipment:

Douglas Lake Equipment can customize a program to suit your needs

Yes, that’s right.  Most customers think that they have to take the posted program or there are set residuals that only apply for what they want.  What we want customers to know is, we can build a lease program specific to your needs and business.

When customizing a lease program, we can shorten or lengthen the term, set specific residual for purpose of a buyout or set the residual on fair market value.  Douglas Lake Equipment can even include extended warranty or maintenance packages in your lease so there is only one payment which makes budgeting and planning your business much easier.

Some OEM Promotional rates apply to BOTH leasing and financing.

This one of the biggest differences from the automotive vs the heavy equipment world is that some OEM promotional rates apply to both leasing and financing.

For example, a current promotion on some of Kubota’s equipment is set for ‘0% for 48mos’. Unlike automotive, this promotional rate is for either leasing or financing which means you can choose either one depending on how you want to proceed.

‘4% for 60 months’ doesn’t mean you need to commit to all 60 months

Certain OEM financial programs will allow you to take a shorter term and still keep the same rate or receive an even better rate. For example, a ‘4% for 60 months’ lease promotion can be modified to be ‘4% for 36 months’ lease program.

This is very useful as some customers have situations that aren’t optimized for a 60-month lease.

For example, a customer needed additional equipment for a new contract that he had acquired. However, that particular contract was only for 30 months. He couldn’t commit to a 60-month lease as his contract was only for half that time.

Luckily for him, we were able to get him to a shorter term lease but still with the same promotional rate.

Residuals can be modified to optimize your payment amount

Yet another thing different from the car industry – Douglas Lake Equipment has the ability to modify OEM recommended lease residual amounts to optimize payments.

This can really help optimize your cash flow.

For example, some customers know that they only need a piece of equipment for a certain amount of time and they intend to walk away from it at the end of the term (like a fixed term project or long term temporary need). In this scenario, Douglas Lake Equipment can increase the residual amount to lower the payments to help with cash flow.

Alternatively, if the customer knows they want to keep the piece of equipment long term but doesn’t have the cash flow now, Douglas Lake Equipment can decrease the residual to help with an eventual buy out down the road.

At the end of the day, Douglas Lake Equipment wants to make sure that you get the equipment you need. And part of doing that is developing lease and financing packages that fit your needs.

Kyle is the Branch Operations Manager at the DLE Surrey Branch and has been with DLE since 2010. As Branch Operations Manager, Kyle ensure that the day to day activities at the Surrey branch runs as smoothly as possible. This includes admin, parts and service, rentals and sales.
Kyle has 3 young boys and is very active and involved in their minor hockey & soccer.