Credit Union Leasing of America. The Multi-Lender COMMERCIAL Lease Program Policies. October 2009

Transcription

1 Credit Union Leasing of America The Multi-Lender COMMERCIAL Lease Program Policies October 2009

2 DEALER PROGRAM POLICY... 1 SIGN UP... 1 COMMERCIAL OPEN END TRAC LEASE... 1 CULA RESIDUAL WEB... 1 RATES & RESIDUALS... 1 APPLYING FOR CREDIT APPROVAL... 1 MAXIMUM ADVANCE... 1 PAYMENT TO DEALER... 1 LEASE TERMS... 2 SALES TAX RATE... 2 NON-ELIGIBLE COMMERCIAL VEHICLES... 2 DOCUMENTATION PACKAGE... 2

3 Dealer Program Policy The following are the generic policies disclosed to the dealer regarding the CULA Commercial lease program. Sign Up To sign up for the program print the Vendor Application located at Click on: Dealers Multi-Lender Commercial Vehicle Lease Program Documents Commercial Open End TRAC Lease A Commercial lease is an open-ended lease in which the lessee enters into a lease transaction for a business or for commercial purposes. CULA s Commercial lease includes TRAC. The TRAC clause stands for Terminal Rental Adjustment Clause, which guarantees the business a contracted residual price at lease end. This business lease has all of the associated tax benefits, and a guaranteed residual at lease end for which the lessee can purchase the vehicle. In the open-end lease, the lessee, not the lessor takes all of the financial risks at the end of the lease. At the end of the lease, the lessee can either purchase the vehicle for the amount of the residual, or can return the vehicle and pay any difference between the actual value of the vehicle and the residual. The majority of open-end leases are commercial leases. Annual mileage on a business lease is often times greater than the mileage on personal automobiles, and the wear-and-tear can be significantly higher. Thus, the actual value at the end of the lease term is harder to estimate, and the lessor is unwillingly to underwrite this risk. Open-end leases typically have a lower residual than closed-end leases, trading off higher payments for less risk of a significant loss at the end of the lease-term. Businesses use open-end leases to gain the financial and tax advantages of leasing. CULA Residual Web The residual website is used to data enter the lease information and print the lease contract and appropriate Rates & Residuals The commercial lease rate factors and residuals are posted at the CULA Residual website (CULA/Dealers/Multi- Lender Commercial Leasing/Program Documents/Rate sheet) in PDF format. Applying for Credit Approval Please utilize Dealer Track for submitting credit applications. Maximum Advance The maximum funding amount is 120% of Manufacturer s Invoice. Payment to Dealer The dealer will be funded within 24 hours of receiving the lease package from the dealer in the mail. 1

4 Lease Terms New & Used Model Vehicles 36, 48, and 60. Used vehicles cannot be more than 5 years old to be considered for the program. Sales Tax Rate Please charge the correct rate on the base lease payment and on any capitalized cost reduction. The original tax rate is based upon the lessee s registered address with the exception of Arizona, which is based on the location of the dealership at the time the lease agreement is signed. Non-Eligible Commercial Vehicles Taxis School buses Driver training school automobiles Ambulances or emergency vehicles Police cars Vehicles hauling gasoline, liquid gas, or combustible, flammable or explosive material Any vehicles operated by truck drivers (i.e. hauling for others) All vehicles that exceed 30,000 GVW Documentation Package After you receive approval, you will need to put the document package together and send it to the lender listed on your approval. The documents listed below are in PDF format on CULA Residual Website, and can be located in the Dealer Track Library as well. Please note: Please do not date the documents, as we will fill these in on the day of funding. Please have the customer confirm the address on the invoice since this is the address all future invoices will be sent. If there is an address correction, the customer should draw a line through the incorrect portion, write the correction legibly next to it, and initial it. Tax is included. Please let me know before funding if there is a change that needs to be made. If customer chooses not to finance taxes, proof of tax payment must be provided for funding. To include in your document package (See Lender approval for complete list of required documentation: Equipment Finance Agreement (2 pages) - Please have customer sign and initial where indicated on page 2. Do not date this document. Corporate Certificate of Resolution (1 page) - Please have the representatives who are authorized to sign documents for the company complete this form. It should also be signed by the company secretary/agent. With small companies, this is sometimes the same person. If it is, please have him/her sign in both places. Master Guaranty (2 pages x 4) Please have guarantor sign where indicated. This must also be signed by a witness. Insurance Certificate Request (1 page) - This form needs to be faxed to the insurance agent. We cannot close and fund the deal without insurance in place. Please fill out the insurance agent s contact information and return it with the documents, so that we can follow up with the agent directly if there are any questions. ACH enrollment form (1 page) This is an optional form to automatically debit monthly payments. If the customer wishes to enroll, please have him sign and complete the form. If he chooses to enroll, this must be signed by a witness like the Master Guaranty. If he does not enroll, this form does not need to be returned. 2

5 Please send the document package to: For SunTrust Approvals: SunTrust Equipment Finance & Leasing Corp. 300 East Joppa Road, Suite 700 Towson, MD Attn: CLAIRE FOSHEE via a delivery service with a tracking number. Any complete deal packet received before 12:00 noon should be funded by the close of business that day. Please be sure to include the following when returning everything: From the customer you will need: Signed and Initialed Equipment Finance Agreement Signed Corporate Certificate of Resolution Signed and Witnessed Master Guaranty x 4 Certificate of Insurance from the insurance agent SunTrust Approvals: SunTrust needs to be listed as the Additional Insured and Loss Payee. We will need to be listed as the Certificate Holder. We cannot fund the deal without this in place. Check made payable to SunTrust Equipment Finance & Leasing Corp due with document packet or information for electronic drafting to be completed and signed. Signed and Witnessed ACH enrollment form (if customer chooses to enroll) Copy of signor and guarantor s driver s licenses 3