Hidden Prepayment Penalties
What we've seen…
Contracts containing the ability to charge interest on future payments when you are ready to pay off your lease or loan.
We've also seen additional end-of-term fees required at the time of pay off.
In certain cases, we've seen provisions that request all remaining payments due at the time off payoff, without a discount for paying off your lease/loan early.
How to protect yourself…
Specifically ask if there are any penalties if you choose to pay off your equipment loan early.
Also, ask if future interest is included in the pay-off amount.
Even if they say no, be sure to carefully review the contract and obtain legal assistance if needed.
This helps ensure you don't lose the flexibility to pay off your financing contract early. Or, that you are not penalized substantially for doing so.
Lease/Loan Comparison Hotline:
As a no-obligation service for policyholders, you can call NCMIC's Lease/Loan Comparison Hotline. A specialist will compare a lease or loan you're considering to ours—before you sign on the dotted line.
Call 800-396-7157, ext. 6939
Learn more about the lease/loan comparison hotline
While NCMIC does not provide legal advice, we'd be happy to compare it to our contract and point out differences in terms and fees.
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