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Home Q&A Forum What are the legal implications and potential risks associated with entering into a finance lease agreement?

Business Contracts

Finance Lease

New York

Asked on Jun 16, 2024

What are the legal implications and potential risks associated with entering into a finance lease agreement?

I am considering entering into a finance lease agreement for a piece of machinery for my small business, but I am unsure of the legal implications and potential risks involved. I have been approached by a leasing company that is offering attractive terms, but I want to ensure that I fully understand my rights and obligations before committing to the agreement. I have heard conflicting opinions from colleagues about the potential risks associated with finance leases, such as hidden fees, early termination penalties, and the potential for the lessor to reclaim the asset. I would like to consult with a lawyer to gain a better understanding of the legal aspects and any potential pitfalls before making a decision.

1 Attorney answer

Answer

Business Contracts

New York

Answered 26 days ago

Damien B.

ContractsCounsel verified

Business Lawyer
Licensed in New York
Free Consultation

This is Attorney Damien Bosco. My law office is in Forest Hills, Queens County, New York City. My practice covers the New York City metropolitan area and Long Island. In some situations, I also handle matters throughout New York State. It appears that you have considered the risks involved. I would say that a significant concern is the possibility of defaulting on payments, which could lead to the lessor reclaiming the equipment due to a security interest indicated by a UCC filing. Lease provisions are often negotiable. Have an attorney specializing in commercial law review the lease to ensure it protects your interests.

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