Before we decide whether to choose a loan or leasing a few words about what it is.
The loan agreement is concluded between the bank and the borrower. By concluding the loan agreement, the bank undertakes to provide the borrower with a certain amount of cash for the loan purpose specified in the agreement. In return, the borrower undertakes to repay the loan in the amounts and dates specified in the contract. In addition, he also undertakes to cover all costs associated with the loan.
The leasing agreement assumes that one of the parties gives the other the right to use a thing. The latter is, however, obliged to pay a monthly usage fee.
Credit and leasing
The main difference between a loan and a lease is the subject of the contract. With the loan, the bank gives us cash for use, which we allocate for the purpose specified in the contract. In the lease agreement, the item for which we incur fees is transferred to us for use.
The procedure for obtaining a loan from a bank is going to be more complex and longer than leasing. Not only more documents are needed, but also creditworthiness on a different ceiling. This is especially important for companies that have been operating on the market recently. An enterprise applying for a loan, not even a year old, may have considerable difficulties in obtaining the desired loan.
It will be much easier for a company that is just crawling to get a lease. This is mainly due to the type of security. In the case of a leasing contract, the company that gives us some object, e.g. a car, to us is still its owner. Until we pay off the last installment of the lease, we are not the owner of the leased property, but only its user.
Leasing is generally cheaper than a bank loan. With the leasing contract, the item is purchased by the company, not the individual. As a result, it can receive a much lower price for a given product than we can when buying it individually. In addition, e.g. the operating costs of the leased car (maintenance, repair, spare parts) are borne by the leasing company.
Credit or leasing
If we are thinking about the choice between credit and leasing, we should consider especially the above information. As a rule, leasing assumes a simplified procedure, less formalities, lower creditworthiness and a lower cost. However, before we decide to lease it blindly, it is worth analyzing both options and only based on individual data decide what is more beneficial for us, credit or leasing.