By Nick Hernandez
Medical practices often find themselves trying to keep pace with advancements in technology, but keeping up is easier said than done. Investment in technology places heavy demands on capital resources. As a result, administrators are exploring alternative sources of capital beyond customary bank loans.
When you buy equipment and finance it with a loan, you own the equipment. The loan just allows you to spread out the purchase price of the equipment over several years. You pay back the principal plus interest over the term of the loan. In contrast, a lease is a long-term arrangement to rent equipment. Technically, you don’t own the equipment when you lease it. However, there are different scenarios. In many cases, leases are virtually indistinguishable from loans, and you receive all the benefits and drawbacks of ownership even though you are technically not the owner. Other types of leases are very different from loans and don’t offer the advantages or responsibilities of ownership.
Do you need new equipment but can’t afford to buy it outright? Equipment leasing might be for you. Many administrators are taking a fresh look at lease financing and that’s raising some significant questions. Administrators should know what leasing options are available, when leasing is an appropriate solution, and what business issues must be addressed in a leasing program. [Read more…]