Direct Delivery

Direct delivery means that the borrower is able to find their own supplier of the asset they seek to finance. This allows the business to negotiate with the supplier on a cash sale basis and so retain the right to bargain at arm’s length to their full satisfaction. When the borrower has negotiated the terms of sale, finance is arranged by another party and is made available to the supplier. Therefore, two agreements are entered into, one for the sale of the asset and another for the financial agreement.
Numerous banks and financial institutions offer this type of finance, and this invariably provides a more specialist financial service as the lender focuses on their area of expertise that is the construction of what is really an annuity in their favor; the lender invests capital into the asset and receives a regular predetermined income for a term.
Because a lender’s resources are directed toward purely financing the asset, the cost is generally lower than if a lender were to provide the asset and also the finance. The interaction Financial Strategy Types with the free market and the freedom for the borrower to participate in that market is also an advantage that a borrower can use to reduce the cost incurred in acquiring the asset.
With this flexibility in place, the borrower is able to easily compare the cost of finance 3 Types Of Financing with other market competitors and choose that which offers the most favorable conditions.
Depending on the asset and the type of finance in place, in the event of the asset being found faulty, the borrower may have an action against the supplier and also the financier. This type of constructive warranty is reinforced by legislative provisions in regard to the asset being fit for the borrowers intended purpose, and if supplied by a corporation may apply as a wrong of strict liability. As financiers for good value, and having had their attention drawn to the fact that the borrower had a specific purpose to which they intended to apply the asset, the lender is deemed to provide finance for a suitable asset. From this constructive knowledge, liability is imposed.
This kind of safety net generally relates to new assets, and applies against all those who participate in the process of marketing the asset, from the manufacturer to the retailer, and particularly to those that modify the goods along the way.
However in the case of second hand or used assets the Sale of Goods legislation will not prove to be as comforting as a buyer is expected to understand the relationship between the quality of an asset and the price that reflects that quality.

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