Frequently Asked Questions

Q:

A:

Why is leasing better than paying cash or taking a loan?

Some financial analysts feel your company’s money should earn you 30% annually. This takes into consideration how that money could be spent on marketing, expanding your business, et al.

If we use that 30% as a rule of thumb, we have a starting point for our example as to why leasing is the best alternative.

Purchase

For this example, let’s figure on your company paying cash for a $25,000 piece of equipment:

$25,000 (company money) x 30% (rate it should earn) =

$7,500 (income/year that $25,000 should earn you)

Taken over a 5-year period:

$7,500 x 5 =

$37,500 (the amount your company should have made off of that initial $25,000)

$37,500 (money lost by purchasing) + $25,000 (cost of equipment up front) =

$62,500.00 (out of pocket expense for a $25,000 purchase)

Lease

Leasing requires (2) payments up front (tax deductible) and you get the equipment after your first payment.

$25,000 (equipment cost)

$612.50 (monthly payment) x 35% (tax bracket) =

$214.38 (deductible taxes on each payment)

$612.50 (monthly payment) - $214.38 =

$398.12 (true out-of-pocket expense/month)

$398.12 x 60 (payments) =

$23,887.20 (total cost you wind up paying on equipment)

Q:

A:

How do banks assign letter grades to my credit?

Very simple:

A = 700 & above

B = 650-700

C = 600-650

D = 575-600

F = 575 & below

Q:

A:

Will a bankruptcy doom me from getting financing?

Not necessarily. Depending on when the bankruptcy was discharged, INFINITAS has many different programs available to help your company get financing.