What does ten 10 times leverage mean for a finance lease

1. In the financial leasing company, the general mode of capital operation is to first use its own capital to lend, and then mortgage the receivables to the bank for financing, to obtain a certain proportion of the loan (50 100% range), and then continue to lend and finance, if the proportion of bank mortgage is 80%, then the leverage of this alone is 1 (1-80%) = 5 times, plus some other financing channels (shareholder fund-raising or debt or **), you can reach 10 times the leverage.

Hello, the leverage ratio can not be for a single business, since the scale of a single business is still limited by the scale of enterprise capital (domestic and foreign channel business is special, let's talk about it later), leasing companies can make full use of the leverage ratio through refinancing.

Legal analysis: in the financial leasing company, the general mode of capital operation is to first use its own capital to lend, and then mortgage the receivables to the bank for financing, to obtain a certain proportion of the loan (50 100% do not lenient, etc.), and then continue to lend and finance, if the proportion of the bank's mortgage is 80%, then the leverage of this alone is 1 (1-80%) = 5 times, plus some other financing channels (shareholder fund-raising or debt or **), you can achieve 10 times the leverage.

Legal basis: Civil Code of the People's Republic of China

Article 707: Where the lease period is more than six months, it shall be in writing. If the parties do not adopt a written form and cannot confirm Article 707 If the lease term is more than six months, it shall be in written form. If the parties do not adopt written form and cannot determine the term of the lease, it shall be deemed to be an indefinite lease.

If the lease term is fixed, it shall be regarded as an indefinite lease.

Article 710 The lessee shall not be liable for compensation if the leased property is used prudently in accordance with the agreed method or according to the nature of the leased property, resulting in the loss of the leased property.

Article 715 The lessee may, with the consent of the lessor, make improvements to the leased property or add other things. If the lessee improves or adds other things to the leased property without the consent of the lessor, the lessor may request the lessee to restore the original state or compensate for losses.

Q: What is leveraged financial leasing? Proofreading Answer:

Leveraged financial leasing, also known as balanced leasing, refers to the lessor generally borrowing 60%-80% of the funds from the bank, and investing 20%-40% of the equipment price in the thick key itself, purchasing the equipment and leasing the equipment to the lessee. This kind of stupid rental method of renting high stools is mainly used when the amount of equipment rented is large and the lessor's family is unable to bear or unwilling to take too big risks.

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Conditions and Definitions of Leveraged Leases and Finance Leases:

1. The conditions for leveraged leasing are that it meets the requirements of the real lease and the residual value of the leased property meets the relevant requirements, which is defined as providing tax deductions and credit to the lessor so that the leasing company can lease the equipment;

2. The conditions of a financial lease are that the lessee has the right to choose and the ownership is not transferred, which is defined as a contract in which the lessor purchases the leased object from the seller and provides it to the lessee for use according to the lessee's choice.

[Legal basis].

Article 735 of the Civil Code of the People's Republic of China.

A financial lease contract is a contract in which the lessor purchases the leased property from the seller according to the lessee's choice of the seller and the leased object, provides it to the lessee for use, and the lessee pays the rent.

Article 736.

The content of the financial lease contract generally includes the name, quantity, specifications, technical vertical and quiet capabilities, inspection methods, lease term, rent composition and payment period and method, currency, and the vesting of the leased object upon the expiration of the lease term.

The financial lease contract shall be in written form.