Master Lease Agreements

December 2nd, 2014

There are a number of important elements that should be captured in your Master Lease Agreements.

 

Today post is by Ryan Melowic, Director of Special Projects at SafeSourcing Inc.

When negotiating a Master Lease Agreement for Fleet Vehicles, it is important to include all the negotiable elements that make up the monthly lease payment.

Master Lease Agreements should include a monetary discount off the MSRP by class of vehicle.  This dollar amount can be applied to any vehicle at the time of lease initiation.   Depending on the number of vehicles needed, the manufacturer or the dealer will offer a MSRP discount. 

Inception fees, such as security deposit, acquisition fee, first month’s payment, taxes, or title fees per vehicle, can be due at lease signing or included in the monthly lease payment.  These fees should be addressed in the Master Lease Agreement. 

The percent of value retained at the end of the lease term can be negotiated.  A percentage of MSRP can be collected and used by vehicle class to determine what part of the value will be paid on during the term of the lease.  These percentages can be static elements within a Master Lease Agreement. 

The Money Factor should be collected by duration of lease term.  This is a variable rate that must be identified in a lease agreement and can be captured in the Master Lease agreement.

Administrative Fees can also be included in a Master Lease Agreement. This fee can be as much as $20 a month.  A fleet with 200 vehicles can equate to almost forty thousand dollars a year of spend for this item alone.  These fees can also be negotiated.

All the items listed above can make up a monthly fleet lease payment.  Therefore, they should be negotiated as well as captured in a Master Lease Agreement.  For more information on Master Lease agreements and making sure you are not overpaying on your fleet leases, please contact a SafeSourcing Customer Service Representative.  We have an entire customer services team waiting to assist you today.

We look forward to and appreciate your comments

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