Leasing equipment for business

man1

Hi
I run a small business and unfortunately we have hit hard times and will have to close down next month. We have a lot of debts and are at present trying and figuring out how to pay all these.
We have equipment that is leased through one of the major banks and was valued at 17,000 euro, we have paid around 3,000 euro over the last year or two.
Obviously we will not need this equipment when we close.
What should we do, do we try to pay the rest of the money off?
If we stop payments (its direct debit so will be hard to arrange that) will they confiscate the equipment and that will be the end of it.
Or are the goods no good to them and will they try to come after me for the money instead??
I have tried to understand their terms and conditions but it is very confusing and I dont want to call them because then they will know my situation.
I dont want to do a runner but if it is just a simple case of them repossessing the goods (which they technically own), I will try to stop the payments.
What should I do?
Does anyone know the rules regarding leasing?

uberwolf

if they're going to find out in a month they may as well find out now.

The T&C for leasing vary, some are specifically charged on the assets, others are also into the other company assets and guarantee's. So it depends on what you signed up to.

Was this a limited company? did you or any other directors offer personal guarantee's of any sort?

The bank are entitled to pursue for their money and costs. They would much rather work with you to find a compromise than to seek to sue for bankruptcty and leave a stain on your ability to start again in the future

stepbar

I can only assume that your lease is with a different bank than your own, because there is no way your own bank would cancel the direct debit if it was their own.

The worst thing you could do now is bury your head in the sand. You need to be upfront with your bank and come to an agreement, because no bank likes to have to go to court to get their money back. Its costly and not worth the hassle. Its more than likely the bank will look to repossess. TBH you should have notified your bank earlier, they could have restructured your finances or looked into other ways to sort the mess out. No bank wants to see a business go under.

BTW what and where's the business? Would you have any buyers for it? Is there any assets you could sell?

Oryx

You dont mention an accountant. If you use one, he can be a very good resource to help you sort yourself out and cease trading in the most painless way possible.