Marlin Leasing (Marlin Busines Bank) Be careful!!

[Aaron Weinstock]

Hi:
I think I should share this so that others don't make the same mistake.
I got a lease with Marlin Leasing.
Here is the story, I am not proud of it since I was a banker at some point. I should have known better. They do not have a penalty for pre-paymant, great, but what they do not tell you is that you owe them the 60 payments with interest no mather when you pay it! In other words even if you only use their money for 3 months, you are going to pay them interest for 60 months.
If things where not bad enough I sent an electronic payment thwogh Well Fargo on the 22nd of the month (Estimated arrival no later than the 29th) and they wanted to charge late fees because they claim they got it on the 5th of the next month, they finaly waived the fee off, I hope I don't have to deal with that one again. They do not offer electronic payment either, so you have two choices, pay by check or by phone, if you pay by phone they charge you a $10 fee.
I hope this helps someone out there.

[Erik Loza]

I've been using Marlin (along with any number of other big names in the machinery lease industry...) for years and never really heard any negative feedback from customers about them. It's a financial agreement and there are any number of ways to structure it, including and not including what you are describing. I'm assuming you knew about these terms when you signed the docs?

Erik Loza
Minimax USA

[Aaron Weinstock]

Erik:
I did ask if there was a prepayment penalty, and they answer no. They should have metioned that there is no logical reason to prepay if you need to pay the interest for the 60 months anyway. Again, it is my fault, but this is not a standar lease. I have leased with other companies and if you only use the money for 3 months you owe them the principal plus the interest for the 3 months. In any case this is just to give people a heads up, nothing else.

[Aaron Weinstock]

Erik:
Today they also informed me that this is the only way they structure their deals. Just my 2 cents.

[Erik Loza]

Aaron, are you saying that these terms were not listed in the agreement you signed?

Erik Loza
Minimax USA

[Phil Thien]

That is standard operating procedure for leasing.

That is just the way it works.

[Aaron Weinstock]

Phil:
Not with the other leases I have.
Erik:
I think I was very clear in my post, it states no prepayment penalty, now why would I prepay if I am paying the interest for the 60 months anyway?
And other leasing companies do provide online payment to make it easy to pay.

[David Weaver]

If you prepay the lease, do you turn over the item that you leased to the leasing company and allow them to sell it before the end of the lease?

The reason they don't let you prepay and avoid paying interest on the terms of the lease is because (well, even if they didn't sell the lease on the secondary market, and I don't know if they do) they have a very defined setup where their two risks after the lease terms are set are the actual residual value of the leased item and your chance of default.

If they add the ability to prepay the lease and forgo interest payment, then they have no way of knowing whether or not they can take the money from your lease and generate income with it to recover the lost interest, and even if they did, they have administrative costs that didn't exist before.

[Phil Thien]

If you prepay the lease, do you turn over the item that you leased to the leasing company and allow them to sell it before the end of the lease?

The reason they don't let you prepay and avoid paying interest on the terms of the lease is because (well, even if they didn't sell the lease on the secondary market, and I don't know if they do) they have a very defined setup where their two risks after the lease terms are set are the actual residual value of the leased item and your chance of default.

If they add the ability to prepay the lease and forgo interest payment, then they have no way of knowing whether or not they can take the money from your lease and generate income with it to recover the lost interest, and even if they did, they have administrative costs that didn't exist before.

When you payoff a lease early, you are essentially exercising the purchase option. So you'd be paying all remaining lease payments, plus the net lease balance.

Here is a bookmark on the topic:
http://www.equipmentleasingcompanies.com/frequently-asked-questions/#q2

[Myk Rian]

I didn't think subjects like this were allowed here.

[Aaron Weinstock]

Thank you for the information Phil. I would still avoid them. My other leases I pay more than the lease and I do get a discount on the interest, and the other companies make it easy for me to pay. But if you are happy with Marlin, go for it.

[Jeff Monson]

Aaron, I had a equipment lease with Marlin also. Never again is all I have to say. I learned a lot about equipment leasing and poor customer service from this experience. IMO there are a lot of better companies to deal with for leasing than Marlin.

[Aaron Weinstock]

Jeff:
Thanks for sharing, that is what I want people to know. Then they can make their own decision.

[Brian Ashton]

Aaron, are you saying that these terms were not listed in the agreement you signed?

Erik Loza
Minimax USA

I think painfully obvious what he's saying... And its a good public service that he's telling others. Do you find a problem with that

[Jerome Stanek]

It just sounds like a public service announcement.

[Erik Loza]

I think painfully obvious what he's saying... And its a good public service that he's telling others. Do you find a problem with that

Many of my customers have leased via Marlin (as well as several other of the lendors who serve the machinery industry here in the US...) and had no issues. In fact, most. I understand that the TS may be unhappy with his experience but my point was that the lendor has not violated their end of the contract. At least not based on the info presented in this thread. David and Phil summed it up pretty succinctly.

I have no financial relationship with Marlin or any other leasing company, for the record.

Erik Loza
Minimax USA

[Jeff Monson]

Many of my customers have leased via Marlin (as well as several other of the lendors who serve the machinery industry here in the US...) and had no issues. In fact, most. I understand that the TS may be unhappy with his experience but my point was that the lendor has not violated their end of the contract. At least not based on the info presented in this thread. David and Phil summed it up pretty succinctly.



Erik, I read your responses, and yes you are correct. The contract does state the rules of the lease, I won't argue those points in any way. My point of saying "never again" is just a personal preference more than anything. Not being able to setup auto pay or being able to pay online is IMO an easy out to get late charges. At the beginning with Marlin, I would send in my payment a week before it was due, it mysteriously would always post a day late, thus a late charge would result. The customer service reps. were always rude about helping me out with it. After that I started sending in payments 2 weeks early, it started going better. I know this was mostly my fault, but the whole experience with them just left a bad taste in my mouth. I just make sure now when I do a lease, to make sure of my payment options, and the fine print of interest and prepay options. I will say if I'm going to lease a piece of equipment, then I plan on running the term with it and setup my budget to allow for the payment. I would not lease equipment thinking I'm going to buy it out in a couple of months. I'm sure in your position, Marlin is a good company and they help you move equipment. I just think there are companies out there that have entered the 21st century with payment options, and polite customer service reps.

[Erik Loza]

I hear what you are saying, Jeff. I guess I was trying to make the distinction between the leasing as a contract versus the personal experience at the customer service level, because those are two completely different things. yes, I would be upset, too, if that what happened to you, happened to me. Thanks for clarifying.

Erik Loza
Minimax USA

[Phil Thien]

Not being able to setup auto pay or being able to pay online is IMO an easy out to get late charges.

That does seem pretty darn odd, IMHO.

I would never deal with an outfit that doesn't have a way for me to pay them electronically.

We have one vendor (one of our larger ones) that only wants electronic payment.