Car Leasing Guide: Types of Leasing Companies
Leasing companies have defined its identity in the auto-manufacturing world. However, contrary to its popularity, not only as the last alternative to any finance arrangement but as a lucrative financing business, there is still a lot of chaos as to what are the types of leasing companies.
To establish order in this aspect, we hereby state the three categories of leasing companies:
Banking leasing companies are leasing companies that are affiliated to authorized finance groups like ING Lease, Raiffeisen Leasing, and UniCredit Leasing. They comprise about 50 per cent of the leasing market value.
Captive leasing companies are those leasing companies that belong to Radacini Leasing and RCI Leasing which comprise about 33% of the leasing market.
Independent leasing companies like Motoractive Leasing are leasing outfits that are on their own. They make up about 17% of the leasing market.
Of these categories, three types of leasing were brought to life. Here are the three in no particular order:
Operational Leasing: In this process, the customer purely rents the product without any intention of buying it at the end of the lease; it’s the company’s responsibility to rent the product out to someone else. This started in Romania and may be more appropriate and popular for leasing equipment and fleets.
Financial Leasing: The customer, in this process, rents an item and has the intention and privilege to buy it when the lease ends. Financial leasing dominates the car leasing process.
Real Estate Leasing: This concerns more about renting residential units and buying them in lease end. According to Bernd Kunzel of Raiffeisen Leasing, this process spells out several advantages as compared to mortgage loans. For one reason, it has an upper hand for undertaking the responsibility of paying the site inspector.