| What a great year to buy new equipment for your | | | | good, then how does that help me?". The answer is |
| business. Granted, many companies and many people | | | | simple, the credit market is tough right now. If you're a |
| are struggling, but there are some great incentives to | | | | new business owner (less than 2-3 years old) and/or |
| buy new business equipment in the year 2008 (like | | | | don't have good personal credit, then financing may be |
| Section 179 of the Federal tax code- businesses that | | | | tough to get or just not possible. |
| spend less than $800,000 a year on qualified | | | | Here's an example. Let's say you have a low credit |
| equipment, can write off up to $250,000 in 2008 | | | | score of 600, your business is brand new, and you |
| compared to $125,000 in 2007). If your business is in a | | | | don't have business bank statements yet-Financing |
| good position or simply needs to buy some heavy | | | | may not be possible unless you go to a hard money |
| equipment like an excavator, bulldozer or backhoe, | | | | lender. If you select off-lease equipment from a lender |
| then buying off-lease equipment is the way to go. | | | | that lowers the bar regarding their credit standards, it |
| There are two separate categories of off-lease | | | | may make life very easy for you in terms of buying |
| equipment these days. The first category of off-lease | | | | and financing that new equipment. Right now, if you |
| equipment (repossessed or turned in at the end of the | | | | are having a hard time getting funding to buy new |
| term) applies to equipment that is bank or lender | | | | equipment because of a recent bankruptcy, a credit |
| owned and the price is potentially negotiable or just | | | | score in the low 600 range, weak financials, or |
| downright excellent. Now, some companies may have | | | | because your business is new, then buying and |
| a tough time lining up the financing for this type of | | | | financing your equipment from a company that eases |
| off-lease equipment (i.e. a newer business, poor credit, | | | | their funding guidelines (rather than dramatically |
| weak financials or all of the above) while others will | | | | lowering the equipment price) may be your best bet. |
| not. If you can pay cash or have no trouble getting the | | | | Whether you are the perfect finance candidate or not, |
| financing lined up for below market off-lease | | | | buying off-lease equipment is an excellent way to get |
| equipment, this is a great way to go and 2008 is an | | | | your hands on the equipment your business needs. |
| excellent time to acquire new equipment. | | | | Lenders will either unload the equipment at a great |
| The second category of off-lease equipment also | | | | price or they'll extend financing to companies that they |
| applies to equipment that was repossessed or turned | | | | normally would not extend credit-all simply to get the |
| in at the end of the lease term. Instead of having really | | | | equipment off their books. After all, they're in the |
| low prices, the lender will dramatically lower their | | | | business of extending credit, not being an equipment |
| lending standards. One might ask, "if the price isn't | | | | dealer. |