End of Lease Options
When looking at End of Lease Options you have a few to choose from that promote ease and flexibility. For your protection, the end of lease options (buyout options) are determined prior to the inception of the lease.At the end of the original lease term the lessee generally has three options:
| › | Return the equipment to the lessor in good working condition. |
| › | Renew the lease for a specific period of time or from month to month. |
| › | Purchase the equipment for a predetermined amount or it's fair market value at that time. |
Options that allow our customers flexibility and convenience, take a look... |
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Fair Market Value (FMV) |
Advantages: Seeking lowest monthly payment, not planning on owning equipment, customer knows obsolescence will lower the equipment value over time. Disadvantages: Purchase price is open ended |
Our Fair Market Value lease offers our customers at the end of the original lease term the choice to purchase the equipment for it's then fair market value as defined in the lease agreement, return the equipment to the lessor in good working condition, or renew the lease. |
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| 10% Purchase Option (Put) | Advantages: Flexibility (unsure about long term plans), fixed purchase option at end of lease term allows to cap equipment cost at a specific percentage or dollar amount, or not sure about the long term depreciation of the equipment Disadvantages: Have to pay fixed put/purchase option at the end of lease term. Have an additional payment at the end of lease. |
With a 10% purchase option our customers have the option to purchase the equipment for 10% of the original cost or at a specific dollar amount, return the equipment to the lessor in good working condition, or renew the lease. |
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| $1.00 Buyout | Advantages: Want to own the equipment, or customer knows the equipment will not lose its value or depreciate significantly over time. Disadvantages: Typically higher monthly payments. |
Our customers at the end of lease term have the option to purchase the equipment for $1.00 at the end of a lease and title to the equipment is transferred from the lessor to the customer (lessee). |
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*Consult your accountant on tax benefits. |