Frequently Asked Questions
Have a question…Great you’ve come to the right source!
"Go ahead, ask a great question and get a great answer!"
Who can lease?
Any company, organization, association, or small business that has a need for equipment or assets for business or commercial use.
Who should sign the lease?
The lease should be signed by the owner of a sole proprietorship, an authorized officer of a corporation, or by the duly authorized partners of a partnership.
Who services or maintains the equipment?
The lessee is responsible for maintenance and receives the benefits of all "buyer" warranties.
What kind of equipment can I lease?
You can lease any business-related equipment! This can include but is not limited to the following: photo-audio-video, broadcast, general office equipment, telephone systems, hardware, software, computers systems, office furniture, work stations, specialty equipment, printing, bindery, machinery, titled vehicles, video production and post-production equipment, printing and pre-press equipment, computers networks, peripherals, and any other business related equipment.
Any capital assets needed for your commercial business…Chances are we can do it! We are also a source for many types of other equipment: car lifts, signs, medical-dental, etc.
What is the interest rate on a lease?
A lease is not a simple interest loan, and therefore does not have an interest rate as we normally think it would. The amounts charged on an equipment lease are calculated using monthly ‘rental rates’. Rental rates are based on various factors that include but are not limited to the term of lease, lessee’s credit history, type of equipment being leased, etc. The stronger your business, the lower your rate should be. MaxPro Leasing’s great rates are very competitive. Obtain a free quote at no obligation and you’ll be surprised at how affordable leasing can be for your business.
What are the End of Lease options at the end of the lease?
You have a few flexible options to choose from; you may purchase the equipment for its purchase option amount, renew the lease for a specified period of time, or return the equipment with no further obligation.
What lease end Purchase Options are available?
We offer flexible purchase options to meet your needs: $1.00 buyout purchase option (which is treated as a purchase), Fixed percentage purchase option (our most popular is 10%), and Fair Market Value (FMV) purchase option. The best option for you can be determined after a brief conversation with one of our account managers. See the link Lease End Options
What are the tax benefits associated with leasing?
From the lessee’s viewpoint, you may be able to deduct the monthly lease payment as a business expense on your tax returns if you have an operating lease you might be able to deduct 100% of your lease payment. You should seek specific advice from your accountant. From the lessor perspective, unless you chose a $1 buyout option, the lessor holds legal title to the equipment and is entitled to any tax benefits associated with ownership.
What about insurance…is insurance required for the equipment that I am leasing?
For the protection of both the lessee (end user, who needs the equipment for their business operations) and the lessor, as owners of the equipment, there is the requirement that the equipment be insured. The lessor must ensure that if the equipment is destroyed or stolen, the lease will be paid off from the proceeds of the insurance policy. Lessee's typically just add the equipment to their existing policy it is imperative that the lessor receives a copy of the insurance certificate which lists them as a loss payee.
What taxes am I responsible for?
A lessor remits applicable sales and use tax directly to your state’s department of revenue, and bills you accordingly. In addition to any local, county or state sales and use tax, you are responsible for paying your annual personal property taxes.
In most states and some local jurisdictions, the lessor is required to pay a use tax on each monthly payment. Since the lease payment was calculated in advance, and these rates change from time-to-time, this amount is billed separately. In certain states, the full amount of taxes is due at the inception of the lease, and the responsibility to do so falls on the Lessor. In these situations, the tax is added to the equipment cost to calculate the monthly payment.
Many states also charge an annual tax on tangible personal property. Since the Lessor is the legal owner of the equipment, they are required to pay this tax. (Our lease rate does not include these costs.) The Lessor passes this cost on to you in either a lump sum or spread over 12 monthly payments. Again, these taxes change periodically and are not included in the calculation for the bas monthly payment.
What kind of fees can I expect with respect to leasing, up-front and honest?
Closing costs, documentation fees, commitment fees may be required, depending on the transaction.
What is the documentation fee?
During the lease process there has been incurring expenses such as credit reporting fees, lien searches, overnight delivery, administrative fees, UCC filings, and papers required to be processed with your local or federal locality. A nominal documentation fee is charged to help offset the expenses for your transaction.
What financing alternatives are available?
We can customize your leasing plan to fit your business requirements, deferred payments, seasonal payments, and no down payments. Take a glance at our attractive…Specialty Programs… for incentives.
What vendor can I order from?
The vendor of your Choice! A benefit of leasing with MaxPro Leasing is that you can purchase equipment from any reputable vendor of your choice. Select your equipment and options, negotiate your best price and let us do the rest!
What if my equipment becomes obsolete?
In the event that you need to upgrade your equipment during the lease term, we will work with you to meet your goal. Obsolescence protection is one of the valuable features of leasing that saves the owner from the risk of owning obsolete equipment. We can typically roll-over your original lease into a new lease that will fit your business needs.
What do I do if I have a problem with the equipment?
If you have problems with your equipment, you will need to contact the equipment vendor for repairs or service. The lessee receives the benefits of all "buyer" warranties. MaxPro Leasing is simply a leasing company that provides you with cost effective financing solutions.
What factors are used to determine credit worthiness?
Length of time in business, financial condition, type of business, credit history, references from financial institutions and D&B or other credit bureau ratings.
What effect does leasing have on the lessee’s bank line of credit?
Established bank lines are typically unaffected and can be better maintained for day-to-day working capital needs. Did you see the…Bank vs. Leasing…page?
What type of information will I be asked to provide for on my lease application?
It’s basic and simple. There are only six steps to complete your application:
1. Basic Company Information
2. Owner Principal Information
3. Equipment Information
4. Equipment Location
5. Banking Relationships
6. Trade, credit references
7. Your Signature and/or authorization
How long does it take to be approved?
Usually in less than 24 hours! Typically requests for up to $50,000 can be approved in a couple of hours from a simple one-page credit application. Once you are approved, the lease documents are over-nighted to the customer. The customer reviews, signs, and returns them to the lessor with the advanced payments or security deposit check.
A Purchase Order is faxed to the vendor once documents have been received, reviewed and accepted by the Lessor. Upon verification of delivery and acceptance of your equipment from you (for your protection from unrealistic vendor promises), the vendor is paid and your lease begins. Your first payment is due about 30 days later.
The process is simple, convenient, and effective so you can get your new equipment quickly. Applications can be made via phone, fax, or on-line over the secure server.
How does the process work?
Choose your new or used equipment from any national or local vendors, negotiate the price. Your MaxPro Leasing account manager will then help you select the best lease option. You approve and sign the lease documents and then the Lessor issues the purchase order. The vendor ships the equipment to you and bills the Lessor. When you tell us that you have received the equipment and sign off on the certificate of delivery, the vendor is paid. 30 days later you begin your lease payments.
How long do I have to be in business?
Typically, 2 years or more. Start-ups and New Businesses are welcome and we have many special programs available for you (Please look at Our General Qualifications…for Start-ups and New Business).
How long can I lease?
Most leases are written for 12, 24, 36, 48, or 60 months, depending upon the type of equipment. Leases for items that depreciate rapidly (such as computers) are usually shorter terms. Maybe you need a term in between 18 months or 30 chances are in your favor we can do it, just ask us!
How are payments made?
Payments can be structured to meet your needs. Our typical payment schedule would include the first and last payments made at the time you sign your lease documents, with your first monthly payment due about 30 days after your acceptance of the equipment.
How are payments figured if there is not an interest rate?
We’re glad you asked. The amounts charged on an equipment lease are calculated using monthly ‘rental rates’, rather than by using a compound interest rate method that is normally associated with bank loans.
A lease is not a simple interest loan, and therefore does not have an interest rate as we normally think it would. Rental rates are based on the term of the lease, the lessee’s credit history (business and or personal), and the type of equipment being leased.
The stronger and more established your business, the lower your payment should be. MaxPro Leasing’s rates are very competitive and among the lowest available. *Obtain a free quote at no obligation and you’ll be surprised at how affordable leasing can be.
How are lease decisions made?
During the process your credit history, bank and trade references will be reviewed, lease structure, and equipment qualification.
Can I include services such as consulting, training, or services on my lease?
Yes. Leasing can include these services which are generally referred to as soft costs. Generally soft costs are limited to a certain percentage of the total lease amount.
Can I cancel my lease or pay it off early?
Although you can pay your lease early without penalty, you are still responsible for the entire stream of payments. You may elect to replace the equipment with a newer model and amend your lease, but your lease contract cannot be terminated or cancelled.
Can non-equipment items such as software and maintenance be included?
Yes. One of the many benefits of leasing includes the ability to "bundle" a number of equipment items into a lease including software, service and installation costs. This provides you with one simple monthly payment for a complete system or equipment line.
Can I still lease equipment if I have already purchased it?
Yes. This is a great advantage and financing tool for your business to put your cash flow back where you need it most…in your business. Typically, you can do a Sales-leaseback for equipment that has been purchased in the last 30 days. The Sales-leaseback is a type of lease in which an asset that is owned by the lessee (you) is sold to the lessor and then leased back to the lessee.
You still have the equipment producing revenue to pay for itself and you gain working capital which can be better re-invested in the business whether it be expansion, growth, or even payroll (See the Specialty Programs Programs...Sales-leaseback).
Can I get a lease if my company is a "start-up"?
Yes. Companies that have been in business for less than 2 years can obtain leasing. Since the company is newer you may have a higher rate because your company is a higher risk investment than a established company. Additionally, you will be required to provide a personal guarantee.
Why do I have to give a personal guaranty?
We make fast, accurate credit decisions based on the limited information requested on our convenient credit application. We check publicly available information and have found that credit bureaus are typically very accurate and reliable and allow us to provide you with a quick credit decision. We’ve also found that payment patterns of privately held businesses mirror that of their principals. The personal guaranty is just a way to meet us halfway. After all you plan on being in business, right?
Why Lease?
There are several advantages that make leasing an attractive option for many firms and companies. These include the fact that leasing offers fixed regular payments, provides financing for 100% of the equipment cost, allows businesses to pay for equipment as it is used to generate income, conserves both working capital and lines of bank credit and may offer certain tax advantages. The profitability of the business is in the revenue it generates not in owning of obsolete equipment. You might want a better picture so take a look at…Benefits of Leasing…
Why should I choose MaxPro Leasing?
We believe if we can increase your bottom line and give you valued added service above and beyond what you expected then don’t we deserve your business. You deserve nothing less than the best, right? Take a look at the Cash vs. Leasing…or the Bank vs. leasing…page and see the leasing advantages your business can use.
Is a down payment required?
No. Usually the first and last months lease payments are generally needed for a security deposit. Good Faith money if you will. This differs from a down payment in that the amount is typically much smaller and it is a true deposit which can be applied to the purchase price of the equipment at lease-end or remaining payments, or returned if there are no other payments due provided the lessee fulfills his responsibilities.
Are lease payments fixed or adjustable?
A lease rate is a predictable fixed rate. This means the rate is fixed for the entire base lease term. Bank loans typically have floating rates which change over the term and can be a roller coaster with the economy. Lease rates and terms are fixed and not fluctuating like a bank’s rates. Did you look at our…Bank vs. Leasing…page?
Does the equipment have to be new?
MaxPro Leasing can lease new or used equipment. Give us a call and ask.
If you have more questions, feel free to...Contact Us today!
(877) 762-9776