LDV Vehicle Leasing FAQs
Read below for answers to some Frequently asked questions about leasing and special service vehicles.
CAN LEASING BE USED IN CONJUNCTION WITH THE GSA OR 1122 PROGRAMS?
No. At this time, LDV’s GSA multiple award schedule does not include provisions for leasing your Homeland Security Vehicle.
CAN A LEASE WORK WITH A GRANT?
Yes. LDV can help you get on our build schedule while you are waiting for an anticipated grant. Basically, we enter into a traditional Lease with you and when the grant funding arrives, then you can pay down principal or make a scheduled payment with those funds. As some grants take up to 12 months for approval and an additional 6 months for funding, this option can get you on the build schedule and into your vehicle much sooner. Of course, if the grant is not approved, you will still be required to make the scheduled payments per the lease agreement.
WHAT IF THE GRANT IS FOR THE FULL AMOUNT?
LDV can help you in this situation by getting you on the build schedule right away. Order the equipment now and pay off the Lease in full at the one year anniversary date (earliest) or when the grant funds are received. This provides a short term financing solution for you and helps you get your special service vehicle added to your fleet as soon as possible.
HOW DO I BENEFIT?
First and foremost, you can avoid equipment price increases. As we all know, the cost of building equipment is ever increasing, often due to increased steel prices. Using a Lease can lock your into today’s pricing while waiting for the Grant revenue availability. As an example, let’s say a customer wanted to wait to order a command center and the difference in pricing, due to steel, was a 16% “upcharge” from June to November, resulting in a final price increase of nearly $50,000. In this example, $50,000 is 40% of their annual Lease payment, which could have been saved by ordering in June rather than waiting until November for a State assistance grant. In addition, you can lock into a delivery schedule that will get you a completed vehicle quicker. Often, your grant money may come in by the time you are ready to take delivery. By offering a Lease option, you can lock in today’s equipment pricing and get your unit faster.
WHAT ARE THE PITFALLS?
Some Grant programs do not allow for liens to be placed on equipment purchased with Grant monies. In these cases, LDV can provide the short term financing described above and then release the lien when the Grant monies are used to pay off the Lease.
WHAT IS THE MAXIMUM LENGTH OF TERM ON A LEASE?
LDV may be able to offer up to 11 years for our equipment. To qualify, the unit must be over $350,000. Based on a $350,000 unit price purchased and Leased by a municipal customer, the annual payment would be $38,705, a much easier budget decision for most municipalities. Of course, we also offer leasing terms of fewer years, based on your needs.
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