Leasing Process

What is a Lease or Equipment Finance Agreement (EFA)?

A lease or EFA is a contractual agreement between two parties whereby the lessor or secured creditor allows the lessee or debtor to use the equipment for a specific period of time in exchange for a series of payments.

There are three parties involved in a lease or EFA transaction:

  • Lessee or Debtor (customer)
  • Lessor (owner of equipment who will finance the lease) or Secured Creditor
  • Equipment Vendor (supplies the equipment)

Roles of Both Parties

Lessee or Debtor:

  • Chooses equipment vendor
  • Agrees to all contractual obligations of the lease or EFA

Lessor Secured Creditor:

  • Owner of the equipment (LCA) who purchases the equipment from the vendor
  • Remits payment to the vendor for the cost of the equipment
  • Bills and receives payment from lessee or debtor

The Finance Process

Step One: Vendor proposes a lease solution to acquire necessary equipment and customer accepts

Step Two: Vendor has lessee complete a credit application and submits to LCA

Step Three: LCA performs credit review on lessee or debtor

Step Four: If approved, customer completes all necessary finance documents

Step Five: LCA receives all necessary finance documents and approves delivery of equipment

Step Six: Equipment is delivered and accepted by lessee or debtor

Step Seven: LCA pays for the equipment and commences the lease or EFA