Leasing Term # 97 – “Gotchas” – Did They Get YOU?
Posted on February 16, 2010
Filed Under Business, Computers and IT, Financing, Leasing, Negotiation, Printing and Graphic Arts | Leave a Comment
A “gotcha” can be a feeling you get when something bad happens to you. My “gotcha” feelings hit my gut first, move to the lower back, then up my spine to my neck. Finally, the “gotcha” is an Excedrin headache.
Sometimes it’s tough to breathe. Heart attack? No. It’s the “Gotchas.”
This is what we hear when you have the “Gotcha Blues”: ”We found out our lease was packed with surprises. We thought we understood the fine print. We didn’t.”
The Lease "Gotchas" - they'll get you every time!
Others found out too late that their options were very bad:
- Buy the equipment for a ridiculous “fair market value price.” Is $350 a fair price for 3 ½ year old computers that you have already paid 2 times the purchase price?
- Renew the lease for 12 more payments.
- Return the computers and sign another lease with the same leasing company. Over someone’s dead body!
Common complaints we hear from people trapped in bad leases:
- All we know is that the “gotchas” got us again.
- We spent 40% more money than we budgeted.
- We need new technology to keep up with the competition. But we’re stuck in a lease.
- Cash flow is tight so we’ll just renew the lease, again.
- We had to bite the bullet. We were forced to put the old computers in storage and keep making the lease payments. And order new equipment. We’ll never lease again.
We see these “gotchas” in every equipment lease – copiers, computers, office furniture, phone systems, forklifts, construction equipment…you name it, we’ve seen it.
TIP: Here are this week’s “gotchas” to look out for.
- The copier salesperson says he can make the balances on your old copier leases go away. Do not fall for this one! The old balance is rolled into the new lease. The old lease payoff is negotiable. Manage the process yourself. Negotiate all lease payoffs.
- The proposal says the “monthly equivalent payment is $5,000.” Red flag! This means the payment will be billed quarterly. Your payment is $15,000 per quarter due at the beginning of every quarter.
- Your purchase option reads “mutually agreed to fair market value.” This means the leasing company sets the price. Negotiate that contract before you sign so you have input into the purchase price.
- “Insurance is included in the lease payment.” Uh oh, gotcha! Never buy insurance from a leasing company. Remove insurance from your payment.
Hope we helped you a little! Check out this link to two free reports – the 10 biggest “gotchas” and the top 10 tips for a better lease.
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