Equipment Leasing 101

Regardless of the types of equipment leasing you’re considering, take time to educate yourself about the process.

Plan Your Equipment Lease

• How long are you planning on using your leased equipment? Make sure your equipment lease agreement is the right time frame for your business needs (shorter if the equipment will be out of date quickly and longer if you will be using the equipment regularly).
• Ask your vendor what your responsibilities are under your purchase agreement. Does the quoted price include sales tax, delivery, installation and training?
• Contact your insurance agent for coverage. This way if the equipment is damaged or stolen you are protected (required on the equipment lease).
• What happens if your leased equipment breaks down? Do you need a service agreement? Ask your vendor if you have to pay for repairs if they occur (service and maintenance costs cannot be covered in an equipment lease.)

Get Your Lease Terms

When contacting your Five Point Capital Lease Manager, have the following pieces of information available to expedite the process. Some information may not pertain to your situation.

• Have your social security number ready. This is one of the most important pieces of information your equipment lease manager will need before completing your equipment lease application.
• Prove your time in business. A business license or tax document will easily show how long your business has been operating.
• Provide business ownership details. This will insure that the correct person is signing the equipment lease agreement. All owners who have more than 10% ownership must be listed.
• You may need to provide a location lease and financing agreement or utility bill. Your lease manager will need to demonstrate location of business, equipment or jobsite. If you have recently moved, are opening up a new location or your business doesn’t show up in public directories, you may need to provide documentation demonstrating the location of the business.
• Business Bank Account information. A business bank account is required to finalize the equipment lease and any fees or payments need to be made from the business bank account.
• Tax Liens or Judgments. If you have any past tax liens or judgments, you may be asked to provide proof that they have been released or satisfied. Sometimes the credit bureaus have not updated their information, so providing documentation will help keep the process from being delayed
• Show proof of comparable credit. In some cases with larger loan amounts you will simply need to show you have been able to pay off large loans before by providing a lease or loan reference.

Closing the Lease

• When you get your lease documents please be sure to follow all instructions and read carefully to make sure everything is correct.
• All documents will need to be signed in black ink and your signature must match your name exactly as it appears on your driver’s license. No white out or cross-outs are accepted.
• You will need to make sure that there is proof of insurance on your equipment. This could hold up the funding of your equipment lease and delay payment.
• Make sure there are sufficient funds in your business checking account for the deposit amount. Bouncing a check could void the deal.