Industry Frequently Asked Questions Huntsville, AL & Birmingham, AL
Find out about the copier/printer industry. There are many things a buyer should know before acquiring a piece of office equipment. Common pitfalls and industry tricks that you need to be aware of. If you have any questions about the information below, please reach out to a TLG representative. TLG makes every Huntsville, AL and Birmingham, AL business it touches better!
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DFARS and NIST compliance for Federal Government Contractors?
Leasing office equipment FAQs
There are many options when leasing office equipment. There are many pitfalls to watch out for. Companies offer mostly 3rd party leasing through banks very much like care dealers. You can lease to own the equipment or lease with an option to purchase at the end, commonly called a Fair Market Lease (FMV). FMV leases are the most common in our industry. Here are some common items with leasing and some things to watch out for.
- All leases have an up front documentation fee. If they don’t, it’s built into the price.
- Leases are purely financing the equipment and have nothing to do with the maintenance agreement.
- Many sales organizations tie the maintenance to the lease. This is not a good option for the customer and we recommend separating the lease from the maintenance.
- Demand from your vendor the lease transitions to a month to month lease at term end. Many lease “auto-renew” for the whole term or another year.
- You have many options at lease end. Re-lease the same equipment, send the equipment back, buyout the equipment or continue leasing on a month to month basis. Don’t let your vendor tell you that you don’t have options and must upgrade the lease.
- Leases are locked financing instruments. Do not sign a lease that increases year to year. Also, do not sign a maintenance agreement that is not cancellable within 30 days notice.
- We recommend 36-48 month terms. If the equipment is performing, re-lease the equipment for a lower price and extend the lease out 12-24 months.
- Some vendors use “in-house” leasing and do not sell the lease to a 3rd party. This is a good option, but you must still watch out for the same pitfalls above.
- FMV lease are taxed differently than Leasing to Own. Each state is a little different, but you will be charged tax on FMV’s even if you are tax exempt.