TECHNIQUES TO HELP STRUCTURE OFF BALANCE SHEET FINANCING
In the course of your operations, if a lessee insists on off balance sheet financing, you must first of all ensure that the lease does not meet any of the 5 criteria including: i. Automatic ownership transfer ii. Bargain purchase option iii. Lease term equal to or greater that 75% of the asset’s economic life iv. Present Value of minimum lease payments equal to or greater than 90% of equipment cost v. Special purpose equipment vi. Techniques to achieve…