Can I pay the lease off early?
When you sign a lease agreement, you are committing to pay a certain amount of payments (12, 24, 36, 48 or 60 payments). This is the difference between a loan and a lease. With a loan, the borrower can pay off the principle balance at any time with no interest. With a lease, you are required to pay all payments (all principle and interest) as agreed through the term of the lease. There is no penalty for early pay off, however you would be exercising your purchase option in addition to paying off the net lease balance. If this occurs early on in the lease agreement, the payoff could be higher than the original equipment cost.
What types of equipment will qualify for a lease?
Equipment leasing companies have their own customized plans for different industries, so it is difficult to list all types of equipment that will qualify for a lease. The most common are:
Construction equipment
Transportation Equipment
Manufacturing Equipment
Medical and Dental Equipment
Industrial Equipment
And Many More….
Who provides service on the leased equipment?
All warranties and vendor guarantees are passed along to you (the lessee). Beyond the warranty time frame, you would contact the dealer or manufacturer. Equipment leasing companies buy the equipment for the lessees, but they do not take liability of the equipment.
Can I return the equipment to the leasing company during the lease if I do not like it?
No, an equipment lease is a contract for a specified number of payments. The only way to terminate the agreement prematurely is to pay-off the lease.
Is the payment on the lease the only monthly cost?
The lessee’s payments may include provincial and federal tax. Tax is calculated by multiplying the payments times the lessee’s local tax rate. Sometimes tax is included in the payment and other times it is billed separately on the monthly bill.
Sometimes it is. It depends on the leasing company. Leasing companies reserve the right to approve the new lessee from a credit standpoint. Once the new lessee is approved, leasing companies will provide an assumption form for all parties to sign.
Can I add equipment to the lease?
You may be able to, but this will depend on the terms stipulated by the leasing company you are working with. Sometimes leasing companies will allow you to add equipment at a later date by signing a separate lease agreement or amendment for the additional items. You will still receive one monthly bill, and you can also arrange so that all leases terminate together.
Can I upgrade the equipment during the lease term?
This varies from leasing company to company. The lease would have to be paid-off and re-written. The amount that it would cost to pay-off the lease and write another one depends on whether you are going to do another lease and upgrade, or pay it off and walk away.
Can I lease equipment from multiple vendors with one contract?
Yes, almost all leasing companies will allow you to purchase from multiple vendors on one lease.
In the majority of cases a lease is non-cancelable unless negotiated prior to documentation with a specialized leasing company. You are required to make all the payments as agreed per the lease agreement.
