What is Crane Finance & Leasing?
Crane Finance & Leasing is a type of asset finance that allows you to acquire cranes and other heavy lifting equipment for your construction business. Cranes are essential for many construction projects, as they can lift and move large and heavy materials, such as steel beams, concrete blocks, and prefabricated modules. However, cranes are also very expensive and can cost hundreds of thousands or even millions of pounds to buy outright. This is where Crane Finance & Leasing can help you.
Crane Finance & Leasing is a way of spreading the cost of buying a crane over a period of time, usually between 12 and 60 months. You can choose from different types of finance, such as hire purchase, finance lease, or operating lease, depending on your needs and preferences. With Crane Finance & Leasing, you can access the latest and most suitable cranes for your projects, without having to pay the full price upfront. This can help you improve your cash flow, manage your budget, and grow your business.
What types of finance are available for Crane Finance & Leasing?
There are three main types of finance that you can use for Crane Finance & Leasing: hire purchase, finance lease, and operating lease. Each type has its own features, benefits, and drawbacks, so you should carefully consider which one is best for you.
- Hire purchase: This is a type of loan that allows you to buy the crane at the end of the agreement. You pay a deposit, followed by fixed monthly instalments, until you have paid off the full value of the crane, plus interest. You can claim capital allowances on the crane, as you are the owner of the asset. However, you are also responsible for the maintenance, insurance, and depreciation of the crane.
- Finance lease: This is a type of lease that allows you to use the crane for a fixed period of time, usually longer than a year. You pay regular rental payments, which cover the cost of the crane, plus interest. You can claim tax relief on the rental payments, as they are treated as an operating expense. However, you do not own the crane, and you have to pay a residual value or a balloon payment at the end of the lease. You also have to bear the risk of obsolescence and disposal of the crane.
- Operating lease: This is a type of lease that allows you to use the crane for a short period of time, usually less than a year. You pay lower rental payments, which only cover part of the cost of the crane. You can claim tax relief on the rental payments, as they are treated as an operating expense. You do not own the crane, and you do not have to pay a residual value or a balloon payment at the end of the lease. You also do not have to bear the risk of obsolescence and disposal of the crane, as the leasing company is responsible for that.
How does it work?
The process of applying for Crane Finance & Leasing is simple and straightforward. Here are the steps that you need to follow:
- Choose the crane that you want to finance. You can either buy a new or used crane from a dealer or a private seller, or you can refinance an existing crane that you already own.
- Contact Clifton Private Finance, a specialist broker that can source and organise Crane Finance & Leasing for you. We will assess your situation and requirements, and find the best type of finance and the best lender for you.
- Fill in an application form and provide the necessary documents, such as your business plan, financial statements, and proof of identity and address. We will submit your application to the lender and negotiate the best terms and rates for you.
- Receive a decision from the lender, usually within 24 hours. If your application is approved, you will receive a formal offer letter, which outlines the details of the agreement, such as the amount, duration, interest rate, and repayment schedule.
- Sign the agreement and pay any fees or charges, such as an arrangement fee, a documentation fee, or a deposit. We will liaise with the lender and the seller to arrange the delivery and installation of the crane.
- Start using the crane for your construction projects and pay the monthly instalments or rental payments, as agreed. At the end of the agreement, you can either buy the crane, return the crane, or renew the lease, depending on the type of finance that you have chosen.
What are the benefits of Crane Finance & Leasing?
- Improving your cash flow: You do not have to pay the full price of the crane upfront, which can free up your working capital and improve your liquidity. You can use your cash for other purposes, such as paying your staff, suppliers, and contractors, or investing in other areas of your business.
- Managing your budget: You can plan your finances more easily, as you know how much you have to pay each month. You can also avoid unexpected costs, such as repairs, maintenance, or breakdowns, as these are usually covered by the leasing company or the warranty.
- Accessing the latest and most suitable cranes: You can choose from a wide range of cranes, from small and mobile cranes, to large and tower cranes, depending on your project needs and specifications. You can also upgrade or replace your cranes more frequently, as you do not have to worry about selling or disposing of your old cranes.
- Enhancing your reputation and competitiveness: You can impress your clients and win more contracts, as you can demonstrate that you have the best and most reliable cranes for the job. You can also complete your projects faster, safer, and more efficiently, as you can lift and move materials more easily and effectively.
Are there any drawbacks?
- Paying more in the long run: You may end up paying more than the original cost of the crane, as you have to pay interest and fees on top of the principal amount. You may also have to pay a residual value or a balloon payment at the end of the lease, which can be a large sum of money.
- Losing ownership and control: You do not own the crane, unless you buy it at the end of the agreement. This means that you do not have the flexibility to modify, sell, or dispose of the crane as you wish. You also have to follow the terms and conditions of the agreement, such as the usage limits, the maintenance requirements, and the return policy.
- Facing potential risks and liabilities: You may face some risks and liabilities, such as damage, theft, or loss of the crane, which can affect your business operations and finances. You may also face penalties or charges, if you fail to make the payments on time, or if you breach the agreement in any way.
How we can help
In need of Crane Finance & Leasing?
We can help you:
- Decide if Crane Finance & Leasing is right for you
- Understand what type of finance best suits your situation
- Feel comfortable with how the process works and what the costs will be
And when we’ve established the best type of finance for you, we will:
- Compare rates from multiple lenders across our network
- Negotiate the best deal for your circumstances
- Guide you through the application process
- Chase through your application until the asset is in your hands
Call our team on 0203 900 4322 to discuss your requirements or book an appointment.
