Your business operates in heavy construction. Even residential construction requires the use of skid steers, backhoes, and other large machinery to complete jobs. Your construction business is still growing, so you have to rent many of the equipment items you need to complete basic jobs and forward this cost to your customers. You find renting construction equipment stressful and inconvenient at times because sometimes the machinery you need isn't available, so you have to be put on a wait list or you have only a few days to use construction equipment because another client is waiting for their rental.
A solution to your problem is this: leasing construction equipment so you have the machinery you need whenever your jobs require them. If you don't have the funds outright to pay for the machinery you need but you want to expand your business and be able to serve a larger client base, construction equipment leasing is a wise option. Before you walk into the loan office for this type of leasing agreement, use this guide to help prepare you for the process.
Gather your profits and losses
In order to get approved for a lease for construction equipment, you have to gather evidence that your company is indeed growing. This is done by showing your construction company's profits and losses for the last year and longer, if you have the information. This is information your leasing agent needs to prove that you have the finances to lease the equipment in the first place and that leasing the machinery will be beneficial in helping your company make even more money in the future.
Know what equipment you need
Do your research so you know what type of construction equipment you need right away. Remember, you can reapply for construction equipment leases in the future, so only get a lease for the equipment you use the most or you need right away. It's best to satisfy one lease before pursuing another so you know exactly how much lease you can afford every month, what equipment you actually use the most — machinery you use on a per-job or periodic basis should be rented, not leased — and other factors that will help you make better leasing choices as your company expands.
When you choose your lender, set aside ample time in your day for your appointment so you can go over the contract and all information without hassle. Your lease agreement will be explained to you in detail so you know how to manage and fulfill your lease. Talk to a company like LeaseSource to learn more.