FAQ
- What is a lease?
- Who can lease?
- What information do I need to provide to get approved for a lease?
- Do I have to personally guarantee the lease?
- What is the lease term?
- Is a down payment required?
- When do payments start?
- Can the lease be canceled?
- Is there a penalty for pre-payment?
- Is there a minimum transaction size?
- How long does it take to be approved?
- What will my rate be?
- Why am I paying sales, property, or use tax?
- Is my lease tax deductible?
- What are the ends of term options?
- Why would I want a FMV lease as opposed to a $1.00 buyout lease?
- What should I do if I'm not sure whether or not I want to own this equipment in three years?
- Can I finance 100% of the purchase price? My bank requires a 25% deposit.
- Can I finance the installation of my new equipment?
- My existing lease still has one year remaining. Is there anything I can do to acquire the equipment my business needs today?
- Does ProPower Capital offer leasing to public agencies, such as schools or governments?
- My credit is not that good. Can I still get a lease?
- Why should I lease vs. purchase?
- When do you pay the vendor/manufacturer?
- What types of equipment can you lease?
- We are a start-up company and need equipment, Can ProPower help?
- What is the documentation flow of an average deal?
- Can I make payments electronically?
- Do I need to insure the equipment?
- Can I upgrade or add-on to my leased equipment?
- Can the leased "non-rolling stock" equipment be moved?
Q. What is a lease?
A. In simple terms, a lease is a contractual arrangement between the lessee (you the customer) and the lessor (the funding source). The lessor purchases the equipment from the dealer or manufacturer of your choice and leases it to the lessee (you) for a fixed, regular payment. Generally, there are two different types of leases: a true lease and a finance lease.
Q. Who can lease?
A. Any private company, sole proprietorship, corporation, private or public organization, or association. We cannot lease equipment for personal use.
Q. What information do I need to provide to get approved for a lease?
A. Our 1 page application is easy to understand and can be faxed for expedited approval. Generally this is all the information we need, although additional financial and personal information may requested.
Q. Do I have to personally guarantee the lease?
A. A personal guarantee is usually not required.
Q. What is the lease term?
A. Lease terms will typically be 24, 36, 48, 60, but in some cases up to 120 months with either fair market value or $1.00 buyout at lease end.
Q. Is a down payment required?
A. Depending on your credit a security deposit, equal to one or two monthly lease payments may be required. It can be applied to the purchase of the equipment at lease end, or returned to you if there are no other payments due.
Q. When do payments start?
A. Typically, regular lease payments start 30 days after the lease documentation is completed. To meet the unique needs of larger customers, we can tailor invoice formats and payment schedules.
Q. Can the lease be canceled?
A. No, a lease is non-cancelable. However, ProPower Capital will work closely with customers to ensure their needs are met with flexible early buy-out, add-on, or technology refresh options.
Q. Is there a penalty for pre-payment?
A. No. However, because a lease is a long-term rental contract, you will be responsible for the remaining payments on your lease. Depending on when in the term you would like to pay it off, a deduction off the remaining payments may apply.
Q. Is there a minimum transaction size?
A. Yes, ProPower Capital has a $15k minimum transaction size. Our credit analysts will determine the amount of financing we can offer.
Q. How long does it take to be approved?
A. For most applications we will have an approval decision within 24 hours of completing and submitting the required paperwork. In some cases there will be additional paperwork requested after the initial packet has been submitted.
Q. What will my rate be?
A. Lease rates depend upon a variety of factors including:
• Type of business
• Number of years in business
• Business credit history
• Fair market value or $1.00 buyout
• Type, brand, and age of the equipment
Q. Why am I paying sales, property, or use tax?
A. Whether you lease your equipment, pay cash for it, or obtain a bank loan, sales, property and use taxes are charged according to the state and local authorities where your equipment is located. We collect the tax and pay it to the tax agency, just as any other vendor would do.
Q. Is my lease tax deductible?
A. With most leases structured as a true lease, usually a Fair Market Value lease, or $1 buy-out leases qualifying under IRS Section 179, then the monthly payments can be deducted as an expense according to IRS guidelines. If your lease is structured as a finance lease, usually a $1 buyout lease, it is treated as a capital purchase and the equipment is depreciated (unless qualifying under IRS Section 179). Please consult with your accountant for proper handling of tax issues.
Q. What are the ends of term options?
A. ProPower Capital offers a full array of lease solutions. End of term options include Fair Market Value, $1.00 buyouts and 10% Purchase Options (PUT). Our Financial Advisors will work to customize lease proposals to satisfy individual requirements.
Q. Why would I want a FMV lease as opposed to a $1.00 buyout lease?
A. Fair Market Value leases typically offer the lowest monthly payments and the entire payment amount can be deducted as a business expense. Furthermore, at the end of the lease term you simply return the equipment to the lessor and replace it with new technology, eliminating the burden of disposing of heavily depreciated or old, outdated equipment.
Q. What should I do if I'm not sure whether or not I want to own this equipment in three years?
A. Many customers worry about future technology requirements. FMV leases give you the lowest monthly payments and the end of lease option to either purchase the equipment or return it to the lessor. With leasing, you have the flexibility to upgrade to new and improved equipment at the end of your lease term.
Q. Can I finance 100% of the purchase price?
A. Yes. Unlike a bank that may require a 25% down payment, we will finance 100% of the purchase price, and usually no down payment is required.
Q. Can I finance the installation of my new equipment?
A. Yes. Most soft costs including installation, delivery and freight charges, training, as well as taxes, can be included in your lease and amortized over its life.
Q. My existing lease still has one year remaining. Is there anything I can do to acquire the equipment my business needs today?
A. ProPower Capital can work with you to buy back the existing lease and incorporate that into a new lease for the new equipment.
Q.
Does ProPower Capital offer leasing to public entities, such as city's, schools or governments?
A. Yes, ProPower Capital is a full-service leasing organization offering lease solutions to the public sector, as well as commercial businesses. We offers tax-exempt financing to organizations that qualify along with specific terms and conditions to accommodate their unique requirements.
Q. My credit is not that good. Can I still get a lease?
A. ProPower Capital has "special niched" funding sources that ONLY work with lessees that have bumps and blemishes in their credit history, even with prior bankruptcies The advantage to you (lessee) is having individuals that will listen to the story and circumstances and base the credit decision on factors other than a credit score.
Q. Why should I lease vs. purchase?
A. Leasing has several benefits over purchasing. We have listed the most common under the "Benefits" section of this site. If you still have questions after reviewing this material please contact us
Q. When do you pay the vendor/manufacturer?
A. When the equipment has been delivered and accepted by the lessee in good working order, a payment for the full purchase price is sent to the vendor/manufacturer.
Q. What types of products and equipment can you lease?
A. ProPower Capital can supply financing for most any type of product or equipment used in a business or government enviornment. If there is a question whether a piece of equipment can be leased please contact us and we will be happy to assist you.
Q. We are a start-up company and need equipment, can ProPower help?
A. Yes, we offer special programs to start-up companies. Please contact a ProPower consultant to discuss the funding options available for your operation.
Q. What is the documentation flow of an average deal?
A. For established corporations the process begins with a completed lease application, along with requested financial data (as needed). the credit package is reviewed for type of equipment, funds requested and risk. A decision is made, approval issued and lease agreements are sent to the lessee for signature. Upon return receipt of the packet, ProPower Capital notifies the vendor/manufacturer for delivery of requested equipment. Upon receipt acknowledgement by the lessee, the manufacturer is paid and lease payments begin as stated in the lease agreement.
Q. Can I make payments electronically?
A. Yes, you may sign up for an auto debit plan, which allows you to have your monthly payments automatically deducted from your business banking account.
Q. Do I need to insure the equipment?
A. Most leases require that customers insure equipment for its full replacement value and that proof of such insurance be provided.
Q. Can I upgrade or add-on to my leased equipment?
A. In most cases, yes. This is one of the key benefits of leasing through ProPower Capital. Our goal is to provide the solution you need, when you need it.
Q. Can the leased "non-rolling stock" equipment be moved?
A. Yes, only with written notice and consent.
