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- An additional source of competitively priced funds
- 100% financing
- Flexible terms
- Long term fixed rate financing
- Improves liquidity
- Improves ROA or ROI ratio
- Avoids 4th quarter mid-quarter depreciation problem
- Improves cash flow
- Avoids alternative minimum tax
- Obtain equipment otherwise prohibited by restrictive loan covenants
- Minimizes the problem of equipment obsolescence
- Simplifies accounting
- Sale and leasebacks offer a variety of advantages to help liquidity or minimize tax problems
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- Some leases may not allow prepayment*
- Some leases add changes for interim rents*
- Some leases contain hidden costs*
- Some leases may have a tax indemnification clause*
- Some leases require restoration of the leased equipment before returning it*
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