| 1. |
Why am I required to insure my leased
equipment? |
|
Since Dollar Leasing owns the equipment and your lease is for the use of that
equipment, we must ensure that if the equipment is destroyed or stolen, our
lease will be paid off from the proceeds of the insurance policy. Most
commercial policies cover leased equipment and your insurance agent can forward
an endorsement to the leasing company at no cost to you.
|
| 2. |
Is there a buyout option at the end of my
lease? |
|
Yes. We offer a guaranteed buyout option at the close of your lease.
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| 3. |
What is a True Lease? |
|
A true lease is a transaction which qualifies as a lease under the Internal
Revenue Code so the customer may claim the rental payments as a tax deduction*
and the leasing company can claim tax benefits of ownership such as
depreciation.
|
| 4. |
What is a Finance Lease? |
|
A finance lease is a transaction whereby a customer can acquire the use of
an asset for most of its useful life. Rentals are net to the leasing company;
and the customer is responsible for all maintenance, taxes, and insurance.
Rental payments over the life of the lease are sufficient to enable the leasing
company to recover the cost of the equipment plus interest on its investment.
Generally, a finance lease is noncancellable during the term of the lease.
|
| 5. |
What is an Open-End Lease? |
|
An open-end lease is a transaction in which the customer guarantees the
leasing company will realize a minimum value from the sale of the asset at the
end of the lease. If the equipment is not sold for the agreed residual amount,
the customer pays the difference to the leasing company. If the equipment is
sold for more than the agreed residual value, the leasing company pays
the excess to the customer. The lease is called an "open-end" lease because the
customer does not know the actual cost until the equipment is sold at the lease
end. This term is commonly used in automobile leasing. |