how much deposit?

How much deposit?

The answer is probably what you would expect - that the amount of the deposit depends on a number of variables:

  • The type of asset financed –the less specialised the equipment, the smaller the deposit.
  • The period of the funding – short term funding for an asset, say 1 or 2 years has a lower deposit than long term funding – 5 years plus.
  • The credit covenant of the business taking out the loan – from the time it has been trading to the strength of its trading performance. Well established, sound, profitable businesses will need a lower deposit than new or loss making businesses.

As a rule of thumb deposits or advance rentals start around 10% of the capital cost of the asset depending on the above criteria.

Call Peter on 01908 262662 to discuss your asset financing requirements