Asset finance jargon buster

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Need an asset finance jargon buster? In today’s post, we have pulled together a handy guide to some of the most common asset finance terms. You can read our car finance jargon buster post here too.


An asset is any resource with a financial value that is controlled by a company, country, or individual.

Assed based lending

A funding solution that uses physical assets (such as equipment) and intangible assets (such as IP) as security against lending.

Balance sheets

States a business’s assets, liabilities, and shareholder’s equity at a specific point in time.


Capital is typically cash or liquid assets being held or obtained for expenditures.

Cash flow

The net amount of cash and cash equivalents being transferred into and out of a business.


The value that would be returned to a company’s shareholders if all of the assets were liquidated and all of the company’s debts were paid off.

Fixed assets

Assets that are purchased for long-term use and are not likely to be converted quickly into cash, such as land, buildings, and equipment.


An agreement where a finance company buys a business asset on behalf of your company and then rents it out to you. You make monthly payments until you cover the cost of the equipment, plus interest.


A lessee is a person who rents land or property, such as plant machinery.


The owner of an asset that is leased, or rented, to another party, is known as the lessee.


Refers to things that you owe or have borrowed.

Purchase option

The opportunity to purchase a piece of property that is being leased after the lease is completed.


Asset refinancing is a way you can unlock cash from items your business already owns (or partially owns).

Working capital

The capital of a business which is used in its day-to-day trading operations, is calculated as the current assets minus the current liabilities.

If you are looking for asset finance and would like to discuss your options, get in touch with Dorsia Finance – | 01522 420 420. We are based in Lincoln but work nationwide.

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