The Federal Leasing Experts -- Our 24th Year!
Federal Leasing
Leasing To The Federal Government &
Federal Agencies
Makes Sense
Vendors: Say YES! to the Federal Government.
Government Agencies: Say YES! to government leasing benefits..
The federal government and its various agencies lease hundreds of millions of dollars of essential equipment--hardware, machinery, vehicles, fire apparatus, office furniture, telephone switches, software and tens of thousands of other items every year. Fact: The U.S. Federal Government is by far the single largest purchasing entity in the world. And YES! we can lead you through the process.
Special Features of Federal Government Leases
 | No Down Payments / No Deposits |
| No Lease Documents |
| GSA or Open Market |
| Automatic
Lease Approvals for Federal Government Agencies. No credit application for Federal lease transactions, credit approval is automatic. |
| Almost Any
Essential Use Equipment
(there are thousands of categories) |
Computers, Servers & Routers Software (to 100%) Telecommunication Communications Equipment Vehicles - Cars, Trucks, Utility Construction Equipment Office Furniture Fire, Rescue & Public Safety Energy Management Systems Military Laboratory, Hospital & Medical Equipment Security & Surveillance [MORE EXAMPLES]
| LTOP (lease to own plan) or LWOP (lease with option to purchase) programs |
| Immediate Vendor Funding |
| NO ONEROUS VENDOR AGREEMENT! First Capital does not require the vendor to sign any "Vendor Agreement." (We have seen vendor agreements that run to 35 pages and more! Vendors--don't fall into that trap!) |
Sell To The Federal Government...
Get Paid Immediately with Less Red Tape!First Capital Equipment Leasing works with federal government agencies as well as vendors selling to federal agencies. We provide federal leases crafted to meet almost any GSA or open-market acquisition requirements. We specialize in "matching" small and medium sized businesses and federal agencies allowing them to work together without the financial red tape and without the risk. Vendors are paid on delivery, no waiting!
Why Federal Lease Are Different
There are several key differences between Federal and all other government (e.g. state, county or municipal) leases and Federal leases are quite different from commercial leases. Lets start with the #1 difference with Federal leases: there is no First Capital lease document, as in the private sector. The "paperwork" originates with government's contracting officer, not the leasing company. The government purchase order ("Order For Supplies & Services") is accompanied by a set of "Terms and Conditions" which can be a very detailed set of product and payment specifications. Government lease purchase orders are generally issued directly to the vendor. The financial proceeds of each purchase order, as they are issued (see below), are assigned to First Capital, via a routine federal transaction known as a "Notice Of Assignment."
The Federal Government Buys One Year At A Time...
Our Vendors Are Paid In Full, On Delivery!Federal agencies are funded year-by-year by Congress and by statute, 98% of those agencies can only spend or commit to spending funds from the current year's appropriation. There are of course many situations where it is in the Federal Government's interest to make multi-year lease commitments to spread their acquisition and ownership costs over several budget years. Federal government agencies will issue purchase orders for the current fiscal years AND can make a "good faith" commitment confirming the government agency's intention to issue additional orders, in subsequent fiscal years, in amounts totaling the full lease amount of lease (i.e.. 36, 48 or 60 months etc). Legally however, the government cannot issue a purchase order for any year other than its current fiscal year.
Leasing Protects The Vendor From Significant Risk
Here's why: Although the equipment vendor is PAID IN FULL by First Capital on delivery, we assume two very significant risks with every Federal lease: 1) Non-Appropriation. As discussed, government entities will enter into multi-year lease agreements, but cannot guarantee the issuance of any purchase order for any period other than the current budget period. If Congress does not appropriate funds for that lease, for that Federal agency, one or more of the future purchase orders that make up the full purchase price may not be issued. First Capital's documentation does not include any recourse to the vendor (who has been paid in full), nor is their any legal recourse to the Federal agency. 2) Termination For Convenience. Many Federal agencies request the inclusion "Termination for Convenience" language in the Terms & Conditions of their purchase orders (see below). Simply put, Termination language allows the agency the unilateral prerogative to designate the leased products as no longer essential to that agency and to simply "terminate" the issuance of additional purchase orders and to return leased products at the conclusion of the current fiscal period. As with non-appropriation, First Capital has no contractual recourse with the vendor, or the government under this circumstance.
Federal Acquisition Regulations
And The Critical "Terms & Conditions"Federal Acquisition Regulations (FAR's) form the basis of the Terms & Conditions that are attached to and/or referenced in Federal agency's P.O.'s (Order for Supplies and Services). The "Terms & Conditions" can be quite extensive and will detail almost of every aspect of the transaction and the agreed-to payments. It is not unusual for there to be some "give and take" in the finalization of terms and conditions. Contracting officers seem to have a fairly wide range of discretion on certain issues within certain agencies. First Capital will need to see the actual order to know what issues may need further clarification etc. (We may also suggest the application of Terms and Conditions currently defined under existing GSA contracts)
LTOP or LWOP? Key Issues For Federal Transactions
One on the more important issues for First Capital is whether the Federal agency "intends" to lease to own (LTOP) , or if the agency is looking to lease with the option to purchase (LWOP). With an LTOP lease it is the government agency's stated "intention" to take ownership of the equipment after the term of the lease and to issue the requisite number of purchase orders over the fiscal periods, to allow for the total number of monthly payments contemplated at the outset. We will also entertain an LWOP structure for certain equipment. An LWOP lease may also be structured by the government agency more like a rental with or without a purchase option. LWOP's structured with a purchase option that includes an early buyout provisions can be acceptable. LWOP pricing based on our risk of the equipment being returned at the conclusion of any given year (without an early payoff), would have to be dramatically higher to accommodate the lesser number of payments toward the total cost. Although we realize that no contracting officer can legally BIND his agency into spending funds that have not yet been appropriated by Congress, nor is it our expectation that a project will be re-evaluated each year as a month-to-month or year-to-year "rental" transaction might be.
Federal Leasing Is Cash Flow Positive!
All First Capital leases are non-recourse (barring a significant contractual default by the vendor) and that the collection of funds after delivery is our responsibility. 100% of the funds will be wired to the vendor generally within 5-7 business days of delivery and acceptance by the government agency. We are a "cash flow positive," and risk-reducing alternative to a vendor providing terms to any Federal agency!
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