Frequently Asked Questions

About Sourcewell cooperative purchasing, government equipment leases, and more

What is Fair Market Value Leasing?

Fair Market Value Leasing is a flexible financing solution that enable agencies to have access anytime to the latest version of equipment, without the hassle of ownership. The agency pays a fixed amount per month for usage, with the flexibility to extend the lease, purchase the equipment for a fair market price, return or upgrade at the end of the lease.

What are the benefits of a traditional Fair Market Value lease?

Agencies who do not desire ownership of the equipment may choose to utilize this form of financing.  It gives them the benefit of using the equipment owning the equipment.  Agencies who wish to refresh their equipment more often will likely choose this form of lease.

What is an escrow agreement or vendor payable account?

An escrow agreement or vendor payable account is an account set up by NCL where the financed amount will be funded and held in the agency’s name for future funding to the manufacturer/dealer.

When is an escrow agreement used with leasing?

With longer lead times often experienced with equipment delivery, an escrow agreement provides the benefit of locking into current interest rates while the equipment is being manufactured.  It is also beneficial when the manufacturer/dealer requires progress payments while the equipment is being manufactured.