Personal Guarantees on leasing equipment

[ondemandbindery]

Hi all. This should creating some interesting conversation. What is your opinion on manufacturers wanting personal guarantees on equipment leasing these days? I am looking at a new market to get into and from the documentation I have read so far they are making sure that if I go swimming into the deep end of the pool that they take no risk with it. Just looking for some experiences in reference to this. My personal opinion is everyone should share in the risk and rewards on equipment leasing.

John Weaver

[mattbeals]

I wouldn't sign it. You cannot discharge the debt.

[ondemandbindery]

They don't have to worry about that. Anybody who is willing to personally put themselves on the Lamb in this industry for 5 years has a bigger set than I do........ I do not think it matters if you are UV coating or Digital Printing, the technology is flat moving too fast. I am sure there is the other side of the coin where people make this work but it ain't for me. I was just looking to see how other people deal with this obstacle.

[rbailleu]

not on a lease, but we signed personal guarrantees on every loan we have ever done with the bank

[OutSourceD]

Good Lord have mercy people. This is standard practice. Even if you are a corporation the leasing company MUST have some where else to turn when you default on your payment. ...and believe me, in this economy, you will.

[ondemandbindery]

Good Lord have mercy people. This is standard practice. Even if you are a corporation the leasing company MUST have some where else to turn when you default on your payment. ...and believe me, in this economy, you will.

Well, I will say Leasing is something I have never done. It does surprise me that Corportations are required to tie a personal guarantee to it. I really do not see how someone is going to be held personally responsible for a Printer that the Walmart Inplant has but I guess anything is possible. I for one could not justify it in this volatile market.

[TheProcessIStheproduct]

Everyone has risk involved, shouldn't the end purchaser...

Manufacture risks capital in R&D

Leasing Company risks capital to bank

Dealer often times guarantees a % buyback if default

it is only fair that you be personally liable if you default on the equipment, everyone else has skin in the game...