No one is probably familiar with the concept of credit, and the vast majority of people have undoubtedly heard about leasing. However, the term “leasing loan” is much less known, although it is slowly beginning to change. This financial product has been growing in popularity for years, which is why it is definitely worth paying attention to what this term actually means. In that case what is a leasing loan? Is there only a car leasing loan or can it be taken for something else? Leasing loan and leasing – what are the similarities and the differences?
What is a leasing loan?
The leasing loan combines the features of both credit and leasing, creating a unique financial product, which due to its profitability, in some cases begins to gain great recognition. This product is called a loan, but you won’t find it in the offers of either traditional banks or loan companies. Leasing loans are granted by leasing companies (although of course not all). Why was such a product created at all? It resulted from the difficulties caused by the settlement of the leasing when using subsidies.
The settlement of an ordinary loan was quicker and easier, which meant that lessors lost clients to banks. A leasing loan is a solution that aims to combine credit and leasing into a product that will be most advantageous in such a situation. It should be noted, however, that currently leasing loans are not only granted to companies that receive subsidies. In many industries, they are very profitable, even if there is no such subsidy. A very important characteristic feature of a leasing loan is the fact that the owner of a fixed asset financed from its very beginning is not the lender but the borrower. Therefore, no equipment purchase costs are incurred and there is no need to transfer ownership after the loan repayment period.
Leasing loan – requirements
Taking a leasing loan is much simpler and faster than taking a loan from a bank. This is because, as in the case of leasing, also leasing loans, leasing companies use simplified procedures of customer verification, and are also more tolerant of even low creditworthiness. Due to the risky nature of leasing loans for lenders, it is necessary to secure them properly. In this way, it is possible to grant loans quickly and easily, while limiting potential losses.
Leasing loan and creditworthiness
As you know, leasing does not affect the borrower’s creditworthiness. The situation is different in the case of a leasing loan, which contains some elements of a traditional loan. Not everyone, but the majority of leasing loan lenders enter them in the database of the Credit Information Bureau. This means that they reduce the borrower’s creditworthiness. It is worth taking this into account if you plan to incur other obligations during the repayment of the leasing loan.