Installment Loans & Leases
FLCC Financing offers two great trailer financing options, loans and leases.
These are offered with some unique options that offer flexibility you won’t find with other lenders:
- Low monthly payments and terms of up to 10 years
- ZERO down programs available to qualified buyers
- Loans can be written in farm, business or personal names
Two basic programs — a TRAC Lease or a Fair Market Value Lease — are available. Benefits of leasing:
- Lease to own with a low buy out
- Payments may be expensed for tax purposes (consult with your tax advisor)
- Off balance-sheet financing frees up cash for other capital expenditures
- Pre-established lease and purchase options
- Quarterly, semi-annual and annual payments
- No mileage restrictions
- No pre-payment penalties
The TRAC Lease is for people who are interested in the benefits of leasing but want to own – “buy out” — their trailer at the end of the lease. TRAC is short for Terminal Rental Adjustment Clause. The buyout is a pre-determined, fixed price, which is typically 10% of the selling price. This type of lease is very similar to a loan with a balloon payment, except at the end of the lease term you have the option to do one of three things: (1) purchase the trailer for the residual amount, (2) trade in the trailer for another trailer (with the trade equity applied to your new trailer), or (3) turn in the trailer.
With the Fair Market Value Lease, there is not a pre-determined residual buyout price. At the end of the lease term, the lessee has the option to either purchase the trailer for its Fair Market Value or return the trailer to FLCC Financing. You’ll have lower monthly payments with a Fair Market Value Lease. But it’s important to remember that at the end of this lease you will not have any equity built up in the trailer. This is a “true lease”, where you’re only renting the trailer for the specified term and building no equity in the trailer.