Welcome to syn*det"ech

Contracting lease terms can be a complex challenge and you need to ensure that you have your organization well looked after.  The leasing company may offer "easy end of life" terms.  Beware!

The easiest term I'm aware of and more often than not negotiate is a $1 buy out at the end of term.

This means I don't have to deal with all the issues of automatic renewals and returning the hardware to the leassor.  Some large hardware dealers such as HP and Dell don't typically offer such an end of term option because their hardware has a high probability of a second life where they gain additional revenue on the used equipment.  However for other manufactures, negotiate hard and shop around.   

When you do, here are some points you should look for when negotiating your lease, or reviewing your lease contract:

• Length of the lease -- This is often called the "term" of the lease, and is usually between 12 and 36 months. The shorter the term of your lease, the higher your payments. 36 months is typical for a computer lease, although you might want to look at a 24-month lease to keep up with changing technology. The cost of 12 month leases is usually prohibitively high, and many experts only recommend you look at this option if you have a compelling reason.
• Total cost -- Analyze all the charges for which you will be accountable for the entire length of your lease. These include your initial down payment, monthly payments, a security deposit, any insurance charges, service/repair costs, etc.
• Cancellation clause -- This allows you to break your lease, although you will be liable for substantial penalties. This way, if you close your business, change its focus, or no longer need a piece of equipment, you won't be liable for the entire term of the lease.
• Assignment -- Find out if you can assign the lease to another party, and if so, what it costs.
• Modern equipment substitution -- If technology changes rapidly, you might want to consider this option. This allows you to update or exchange your equipment so you don't get stuck with something that's obsolete.
• Service plans -- Find out if your lease comes with an on-site service plan, and if so, determine its length. If you have only 1 year of on-site service, you may need to extend it to the length of the lease; otherwise, you will be responsible for all repairs yourself after the first 12 months. Also, be sure the contract spells out when the service will be performed (ideally, next business day).

1. Leasing/Purchase IT Equipment
2. How leasing works
3. Advantages and disadvantages of leasing

1. When a lease is not a lease
2. Are Computers Becoming Another Utility Cost?
3. What happens at the end of a lease?
4. Leasing Agreement Management