Eastern Funding, LLC

Successful day-to-day operations require an uninterrupted supply of capital. Loans are one very common means of attaining such capital. Both Term Loans and Lines of Credit can represent a very attractive means of accomplishing one's business goals. Because every business is unique, the major benefit of a loan is a structure to effectively meet your financial requirements. This can help to minimize interest and charges and can also offer the flexibility you may need to take advantage of future opportunities.

However, many businesses with outstanding loans, or lines of credit, have restrictions, or covenants, placed upon them by the lending institution as a condition of approval for the loan or line of credit. Depending upon the language and intent of these covenants, a lease may provide a method of financing not otherwise permitted by such restrictions.

Leasing enables the business to avoid the use of short-term cash lines, thus conserving borrowing capacity for financing inventory, accounts receivable and other short-term needs.

For many small businesses, leasing is a viable financing alternative to buying with a loan. Leasing may allow your young enterprise to conserve cash. It may also allow you to avoid buying equipment you may not want for long.

Lease payments are made with added revenues generated from the use of the equipment using pre-tax dollars. Loan payments are paid from "after-tax" revenues.

Companies routinely use leasing for some of their financing. Airlines lease their airplanes. Car-rental companies lease their fleets of rental vehicles. Most companies lease some or all of their office, warehousing, and retailing space.

A lease is a contract that obligates your business (the lessee) to make periodic payments to the lessor over the span of a lease term.

In the start-up or growth stage of your business, you may need to keep your cash expenditures as low as possible. You may also wish to avoid owning equipment in the early stages of your enterprise. Leasing helps your business to accomplish these goals.

If you need more information, please call us 212.819.0469.

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