My sister-in-law applied and received the lease. Minus the confusion that led to finally getting the funds, she found out yesterday that a 71.5% finance charge was added upon signing the lease. Discussing this with the leasing company and requesting the document that dictates this information and our agreeing to it, they say that doing the math on the amortized loan amount would have shown the charge. Okay, agreed but is there any upfront disclosure rules that should have been presented before sticking it in there?
Some assistance with equipment leasing rules, laws (if any) and defaulting would be helpful.
Thanks for any assistance.
Extending on the second answer received, am I to understand that lease financing is not susceptible to the same disclosure details as typical bank financing?
She is trying to get a copy of the documents from the lease company as I type. From their, she can compare what is on file to what they have.
Thanks for your answers and assistance.
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The percentage on the lease has to be in writing on the paperwork that your sister signed. Usually, she has to sign EVERY page of the contract. If she did not sign every page, and the page that has the extra amount does not have her signature, she can sue the company and make them drop the 71.5%. She would be able to say that the 71.5% contingency was not in the contract she signed, and that the company is trying to take advantage of her. A judge would fully agree with her as long as her signature is NOT on that page.
Generally, a lease percentage is added a little bit over time, not all at once, so she would have a good case if they hit her all at once.
Hope this helps.
Its a lease so there is no percentage finance charge disclosure, as on a loan. In the lease, the Leasing Co owns the equipment, you are “renting” it. They are correct in that you could estimate a “finance charge” by doing the math yourself. Sorry, wish I had better news for you.