How to Write an Equipment Lease
If you are leasing equipment, you'll need to write up the lease agreement. Each step walks you through the different sections of the lease.
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Instructions
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Who is your lease with? The first section should state the lessor and lessee. The following is a very general format:
This equipment lease is made and effective by and between, [name of lessor] and [name of lessee].
Lessor desires to lease to Lessee, and Lessee desires to lease from Lessor, certain tangible personal property.
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What are you leasing? Enter and describe the equipment being leased by plugging it into the following format:
Lessor hereby leases to Lessee, and Lessee hereby leases from Lessor, the following described equipment [equipment being leased].
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3
Terms of the lease. When does it start and how long before it expires.
Terms of lease will commence as of [date]and will expire [lease length] months thereafter.
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The next section states the responsibility of lessee to ship equipment to lessee's premises. Simply by stating, Lessee is responsible for shipping equipment to lessee's property.
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The fourth section is for Rent. Spell out the terms of payment.
The monthly rent for the Equipment shall be paid in advance in installments of [Installment Amount] each month, beginning on [Date of First Payment] and on the first day of each succeeding month.
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Terms of Use, include proper and careful use of equipment. You should also state any restrictions on usage in this section.
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Repairs, Loss, and Damage things are responsibilities of the lessee. Make sure to include that Loss or Damage of equipment does not invalidate the lease agreement.
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Include surrendering rights, which state that when the stated terms are over, the lessee must return the equipment to lessor in the same condition it was recieved.
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Lessee is responsible for insurance and the insurance company and/or policy must be accepted by the lessor.
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A very important section is the rights of the lessor's payment. Failure to provide payment as specified gives the lessor the righ to charge 10% interest on any outstanding payment.
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Indemnity. Basically the lessee cannot sue the lessor for any damages or liabilities.
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The Default section provides the lessee with the rights of the lessor if the lessee does not make a payment within 10 days. The first is declare the total amount of the lease due immediately. The second is to take the lessee to court and sue for outstanding rent payments. The third, repossess the property. The fourth is terminating the lease agreement.
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Ownership rights.
The Equipment is, and shall at all times be and remain, the sole and exclusive property of Lessor; and the Lessee shall have no right, title or interest therein or thereto except as expressly set forth in this Lease.
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The last section before signing on the dotted line is writing a statement that ensures the agreement cannot and will not change after it is signed.
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Tips & Warnings
There are many programs online that provide equipment leases you can download and fill out for free.
Confide in local officials to talk about the specifics of the lease agreement because every state has different requirements.
