What is an end of lease option? At the end of a leasing term, a lessee will have certain choices they can make with regard to what will happen to their equipment items after the lease is over.
Equipment leasing is used by many different businesses today for acquiring all of the essential equipment items a business could need during all the different elements of their operation. One aspect of equipment leasing that seems to attract a wide range of different types of leasing clients is the fact that leasing offers a number of different end of lease options which can give businesses real flexibility with regard to the final outcome of their equipment items. What is an end of lease option? Hopefully, after reading this, you will have a solid answer to this fundamentally important leasing question.
An end of lease option provides a kind of flexibility that cash purchasing equipment simply cannot and does not provide, which basically affords another point to leasing as being a highly beneficial acquisition method. Cash purchasing tends to be the most common alternative to leasing, and even though it can provide a business with everything it needs to operate successfully, it tends to do so with a greater degree of risk and less security than leasing does. The reason for this being true is very simple, and it can be summed up by saying that cash purchases are expenses that take place all at once, while leasing allows for important items to be paid for over extended periods of time.
Simply put, end of lease options give a lessee some room to maneuver with regard to the outcomes of their leased equipment items. For the informational benefit of lessees everywhere, some more information relating to the question of, “what is an end of lease option?” will now be provided.
What is an End of Lease Option?
At the end of a leasing agreement, there are a number of different outcomes that can be chosen for the equipment items that have been leased. The one you ultimately choose for your business is going to have a bearing on what happens to your equipment at the end of the leasing agreement, and depending on which one you want to have, you may have to return your equipment items at the end of the lease or perhaps you would prefer to keep the items indefinitely.
These options represent the main outcomes that are available to lessees when they make the decision to lease equipment. A one dollar buyout lease is sometimes a preferred option for lessees for the way it gives them the ability to keep their equipment items at the end of the leasing term by making a final buyout payment to the leasing company (often, only one dollar).
An opposing option from the one dollar buyout lease is the option of returning your equipment items at the end of a leasing term back to the leasing company you received them from. Depending on the nature of your specific business, either one of these options could work out for you.
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