Financing

  • Leasing Options
  • Advantages
  • FAQ's

"Different needs, different financing options"

Fair Market Value

If you're looking for your lowest monthly payment, then a fair market value lease is the choice for you. With this lease, you'll find that the price is right and at the end of the lease you'll be offered the following options — it's up to you:

  • Return the equipment to us
  • Purchase the equipment for fair market value
  • Continue to lease the equipment

It's a great choice for customers who are concerned about their equipment purchases becoming obsolete due to the rapid growth of today's technology.

One Dollar Purchase Option

The one dollar purchase option combines the benefits of both leasing and ownership. You are able to take advantage of a monthly payment schedule, while also becoming the owner of the equipment. Although the monthly payment is higher than fair market value, you will own the equipment at the end of the lease, for just $1.00!

This is a great option for customers who ultimately want to own their equipment without incurring all of the expense up front.

10% Purchase Option

Here's an alternative if you want to leave your options open. You will get a reasonable monthly payment which still allows an end of lease buyout. With the 10% purchase option lease, your payment will be lower than a one dollar buyout lease, but may be higher than the fair market value option. At the end of the lease term, you will have the following choices:

  • Return the equipment
  • Purchase the equipment for 10% of the original selling price
  • Continue to lease

This is the option for you if you're unsure of your future needs.

Definitions

Fair Market Value

Definition: A transaction between you and TIG Financial Services Group in which you pay for Usage of the Equipment. You do not own the equipment during the term of the lease.

One Dollar Purchase Option

Definition: A transaction between you and TIG Financial Services Group in which ownership of the equipment is transferred to you at the end of the lease.

10% Purchase Option

Definition: A transaction between you and TIG Financial Services Group in which ownership may be transferred at the end of lease for a fixed 10% purchase option. You may opt to return the equipment.

Sustains a Competitive Edge

Businesses change almost daily. New competitors, new market forces, new financial strains, and new organizational structures all add up to a need for flexibility. When selecting new technology, one often wonders if it will be replaced by a faster, more powerful alternative next year, or even next month. Leasing can help avoid the risk of ownership because you only pay for the use of the equipment. When your lease expires, you can then buy the equipment, trade it in for the latest technology, or simply walk away (depending on the type of lease chosen). With leasing, you can put a technological "safety net" in place, so your companies' competitive edge is never dulled by the process of moving up to faster, larger, or different equipment.

Conserves Capital

Leasing lets you keep capital free for investment or other business expenses instead of tying it up in fixed assets. Profits from these investments offset the cost of the lease -- you don't have to own an asset to make money using it.

Generates Profits

You can reinvest the cash conserve in inventory or new marketing promotions -- investments that can bring real profits to your business.

Preserves Existing Credit Lines

Leasing gives you a new source of credit for present and future needs, while existing bank lines remain intact for other uses.

100% Financing

Unlike bank loans, leasing can mean no down payment, no deposits, and no required compensating balances. In most cases, installation, wiring, maintenance, taxes, shipping charges, and even software costs may be included in your monthly payment.

Tax Advantages

Leasing offers important tax benefits that reduce your cost of obtaining equipment. Depending on the type of lease, you may be able to write off the entire monthly payment as an operating expense or capitalize the outlay.*

Budgeting Advantages

Leasing guarantees a fixed monthly payment amount for the length of the lease term, so it's easy to forecast your equipment expenses. It also gives you the flexibility to obtain unplanned-for-equipment -- when capital budgets can't be stretched to allow outright purchase.

Pay as You Go, Not Up Front

With leasing, you pay for equipment as you enjoy the benefits of using it.

Perfect Solution for Expanding Businesses

You deserve access to the latest equipment and technology. Leasing protects you from being locked into owning equipment that may not meet your future needs. You will have the flexibility to upgrade to the newest releases, features and functionality as they become available. Leasing is often the financing solution of choice for businesses that hesitate to buy equipment because they fear it will become obsolete before they can fully depreciate it.


Be sure to consult with your own accountants or tax advisors regarding the tax consequences of leasing and financing transactions.

Q: What happens to the equipment at the end of the lease term?

A: It's your choice. We offer a wide range of options which can be tailored to your needs. Not only can you purchase the equipment at fair market value or at an agreed upon percentage of the original cost, you also can purchase the equipment for $1.00 or simply return it to us.

Q. Isn't it cheaper for me to pay cash?

A. When you purchase equipment, there is a loss in the earning power of that up-front cash payment. For example, if the net profit on working capital is 15%, then you lose 15% a year. Leasing gives you the use of your money and the use of the equipment you need so you can pay for the equipment out of earnings over time rather than put up equity capital all at once.

Q. Isn't it better to own equipment?

A. Use of equipment, not ownership, produces profit. It is usually more economical to lease equipment and use your cash for other needs. Depending on the type of lease you choose, you can either purchase the equipment, or return it and lease more updated equipment, at the end of your lease term.

Q. Are there any other fees associated with my lease?

A. Yes, you will be charged a one-time documentation fee.

Q. Do I need insurance?

A. Yes, you are required to carry insurance that covers fire, theft, loss, and general liability. CIT Finance LLC must be shown as the loss payee and the additional insured on the policy. We can assist you in obtaining the appropriate insurance coverage.

Q. Is the lease cancelable?

A. No, a lease is a non-cancelable contract.

Q. Who pays the taxes?

A. The lessee is responsible for all taxes, but the actual payment to the taxing authority is made by the lessor, who is reimbursed by the lessee (you).

Q. Why is it "fair market value" instead of a predetermined amount?

A. The IRS has certain guidelines for a true lease, and one of the stipulations is that it must contain a fair market value purchase option. If the purchase option were guaranteed, your monthly payments would not be a fully tax deductible expense.

Q. What is the fair market value purchase option going to be

A. The fair market value of the equipment will be determined by the market. If an agreement between the lessee and the lessor cannot be reached regarding market price, an independent appraisal will be used to determine the amount. A fair market value lease option offers the lowest monthly payment, payments that are tax deductible as an operating expense, and a flexible purchase option at the end of the lease. "Fair market value" is just that - the price for which the equipment could be rented or sold in a transaction between unrelated parties.