Don’t Get Scammed When You Are Looking For An Equipment Leasing Broker

The current economy has unfortunately brought out a lot of bad people.  In the last year we have seen fraud on both sides.  Some so called brokers and even on applicants for equipment leasing.

Many businesses want to take advantage of the benefits of  equipment leasing but they don’t

Fraud
Don’t get fooled by scammers!

qualify.  This is were scammers come in.  They promise to help people who can not get approved in the traditional sense.  Since equipment leasing does have flexible credit and time in business guidelines, business owners are taken in by these scam artist.

Do your research

With the advent of the internet you can learn a lot about a company with a simple google search.  Google your prospective broker and make sure that they have a good reputation.  If you don’t find anything, don’t be alarmed.  Equipment leasing is still a mostly offline business.  Also since some brokers specialize in equipment leasing for businesses with bad credit, its not surprising that business owners are not jumping up and writing reviews about how there broker helped them despite their terrible credit.

Another tool you can use is the BBB.  Again, not everyone belongs to the BBB but at least you can find out if any complaints have been filed agains them.

Call the prospective broker, talk to them and see how comfortable you feel with them. Listen to that little voice in your head, if you feel uncomfortable, move on. There are many different brokers out in the world!

Telltale signs of a scammer

    1. You have recent credit problems (last year or less) recent foreclosures have only allowed brokers to use financial instruments like equipment sale leasebacksand other collateralized loan programs

 

    1. They say they wrap a working capital loan into your equipment lease. Again you either have a loan or you have an equipment lease. Equipment sale leasebacks can be used for working capital or to purchase additional equipment, but again this is a specialized program. When a broker says they are wrapping a loan into a traditional lease, be wary. They maybe inflating the cost of your equipment to cover the loan. This is illegal. How this works is lets say your equipment cost $10,000. The fraudulent broker tells them it cost $25,000 and sends you the client part of that additional $15,000 as a “refund” or draw against your lease. When fraudulent brokers do this, they usually keep a large part of this loan as their fee. I’ve seen them take as much as 40%. Again, this is illegal you want no part of this sort of transaction.

 

    1. Unreasonable Up front fees. Fraud brokers will claim they need money before they can tell you if you are approved or not. While there are legitimate brokers that utilize upfront fees before they will work on your account there is a DRASTIC difference in the way their contracts are written. A legitimate broker will send you a letter outlining what kind of term they can get for your equipment lease request. They will say before they are willing to put in a lot of effort in getting your lease request approved by the bank they want you to sign that everything you have stated in your application is true, the funds in your bank account are truly your funds and not additional loans that will need to be paid and the biggest difference will be, on their documents it will state that if they can not get you the terms outlined in their funding agreement, your upfront fee will be refunded.

 

Why do legit brokers do this? Because of fraud. Unfortunately there has been a rise in fraudulent lease submissions. Sons pretending to be their fathers, partners opening accounts in each others names and so on. As a broker we don’t’ want to fund these people and usually with an upfront fee you will scare them off. It also cuts down on people who will simply waste our time. There are some people who will apply for things just to see if they can get approved and never think about how much time and effort a broker went thru to get then approved.

If its too good to be true…..

The biggest thing that will help you not get scammed is just using good old common sense. If it sounds to good to be true, it usually is!

Looking for an equipment leasing broker to work with? Contact us NOW to apply for an
equipment lease!
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7 thoughts on “Don’t Get Scammed When You Are Looking For An Equipment Leasing Broker

  1. Yes, I experienced some of this. Even though I have great credit, somehow scammers got a hold of my cell phone number and e-mail address and was giving me a full court press to sign on with them. Leasefunders clued me in on their ‘offers’ and saved me a lot of headaches!

  2. For real! Scammers seem to smell new startup businesses and start circling like sharks! This was one way LeaseFunders helped us – by showing us how to NOT get taken advantage of.

  3. I’m currently in talks with several equipment lease brokers and one of them did suggest that I should wrap a working capital loan into my equipment lease. I didn’t think much of it at the time and I was just happy that I was able to get what I needed, but now I see that I was not seeing the complete picture. This broker will not be getting a call back from me.

  4. I give the author many thanks for this article. I’m yet to speak to a single equipment leasing broker, but I’m currently looking for a few and I’ll soon be making deals with them. The thing is I’m a new equipment vendor and have never leased any equipment before, so therefore I have zero experience dealing with brokers. But now I know to google them first, check them through BBB, and to speak to them on the phone before meeting up for the real deal. I’ll keep in mind about the telltale signs of scammers and be sure to not fall on any obvious scams.

  5. Hi Victoria!

    Like all industries you will find a few people just want to make a quick buck and aren’t in it for the long run. I’ve been doing financing, including equipment leasing for over 20 years. We welcome vendors and you can see more information on our vendor leasing programs . I would love to work with you on some deals. Feel free to ask me anything! I love working with new startup businesses and I want to help you grow your business too!

    I look forward to speaking with you!
    Liz Roberts
    1-888-308-7160

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