Let`s talk about the different types of funding, then the positives and negatives of each. From a practical point of view, it may be uncomfortable for some advisors who have more experience to lend than to rent when it comes to including the traditional rental language in a document recognized as a loan document. If this is the case, the benefits of the assertion that the EFA`s commitments are absolute and unconditional can be offset by the need to appease a banker. Even before the transformation process begins, two fundamental questions must be answered: first, does the lessor want the EFA to look like a loan agreement or a lease? Some lenders want to maintain the transactions they offer as much as possible from the transactions offered by the competing banks. Others want the transaction to be clearly a loan to target customers who are afraid of leasing. Second, what are the priorities? Does the owner want the agreement to be as consistent as possible with existing rental documents? What consistency should be maintained? Is length a problem or can a language be added to protect the legal risks associated with granting credits? Unlike an efA (Equipment Finance Agreement) agreement, a $1 purchase lease is the case if the lender owns the equipment until the end of the life. The tenant (client) then has the option to return the equipment for new ones, or buy it for $1. Some sectors or companies prefer this type of rental product because it may have some accounting advantages. In this article, I focused on the application process and how simple it was. This time I will highlight some of the differences between an equipment financing agreement (EEA) which is a loan contract with an equipment finance company and an installment credit contract that is a typical loan contract with a bank.
The District Court of Appeals ruled that the lease was a “real lease” and that the landlord could be held liable under Florida`s doctrine of dangerous instrumentality. In support of these findings, the Tribunal found that the agreement was called the Commercial Vehicle Lease Agreement and that the document indicated that the owner owned the truck.