[Ian Gourlay]

From time to time we all need new equipment etc

So may be tempted to buy on lease.

But what appens if we are off sick a long period.

You can get cover for dyeiing

You can get Income Protection Policies but if you have other income sources not a lot of use

But some how you need over for lease payments

ie Your payments are made  if you are sick no matter what other income you have.
Obviously you need a enine bad back etc

Anyone have anything like that

[Doctor Carpet (Ret'd)]

Hi Ian

After 85 views by people I'll kick off with an answer.

Firstly I assume you do mean leasing rather than buying by way of a loan.

If you meant a loan then personal loans wouldn't be the normal way as the cover you are looking for normally excludes self-employed. However business loans from banks etc should normally come with that type of cover as an additional cost.

I didn't really understand you comment about income protection. Admittedly these types of policy are limited to the level of your income (as per accounts) but you would still be able to claim under it, and if there was anything left after paying for your domestic running costs (unlikely i know) then the surplus can be injected into the business  (as a capital injection/director's loan) to cover the leasing costs.

Critical illness cover (heart attacks, strokes etc) pay out a lump sum (so you win even if you don't die -sorry for the morbidity - ) and would allow you to continue with the payments or simply pay off the outstanding balance.

I would think some leasing companies should offer some type of cover as it is obviously in their interests to offer it if for no other reason of earning commission on the sale of the cover.

Keep looking and good luck.

Hope this helps.

Roger

[Kinver_Clean]

The cover given by banks & leasing companies is usually expensive and has so many get out clauses they are useless. There has been a lot in the press lately.

Your best bet is to find an independent insurer to cover you. I had a policy that you bought chunks of benefit for a set amount. Ask a broker, mine was about £2.50 per month for £100 / week. I stopped when I was 60, so I don't know latest figures. There are some good deals about. Look on thisismoney website.

Hoping you never need it.

Trevor

[Ken Wainwright]

My view on leasing, being a cautious old so and so, is that as an owner operator I wouldn't feel secure. Yes you can probably insure yourself for sickness and critical illness to cover the repayments, but that significantly increases the cost of your borrowing.

But what if............ you lost your license? It does happen.  Or what if there was a downturn in trade and you couldn't meet the repayments?    You'd have £10K, £15k or perhaps £20k worth of scrap metal on the drive that you couldn't use but still had to pay for.  With a loan, you can always sell the van.

As far as I'm aware, you also have to pay V.A.T. on every element of a lease repayment. With a loan, you don't pay the tax on the interest. So, to get the best value from leasing, you need to be V.A.T. registered.

Safe and happy cleaning
Ken

[Steve Chapman]

if leasing equipment can you not send it back if you cannot afford it any longer,

or is that too much wishful thinking

steve

[John Kelly]

Unfortunately you can't send it back. Basically the leasing company buys the item from the supplier then leases it to you.
Usually via a 3rd party finance company. Sending it back would entail the leasing company and finance company negotiating with supplier to have it back. Item would have to be examined and tested and second hand equipment is worth zilch. Wouldn't happen.
I believe it would be possible to negotiate a cash settlement for the remainder of the lease then sell the equipment to part fund it.

[Steve Chapman]

Damn