Equipment lease agreements are rental agreements that legally bind the owner of the equipment to the person who is leasing the equipment. This type of lease agreement must abide by any state governing laws, and it’s an essential document in any situation where a piece of equipment is rented.
An equipment rental agreement form will stipulate what the renter has to do in exchange for the right to use that equipment, what type of payments have to be made, and what rules the renter must honor when using or returning the equipment.
An equipment rental agreement or equipment rental contract is just that: a legally binding contract where two parties agree to specific terms. Those terms typically include things related to the equipment being rented such as rental payments, whether the agreement immediately goes into action or will go into effect at a later date, information about the security deposit if applicable, the rental period, any grace period for late payments, and any other relevant details.
Renting equipment is very popular for short lengths of time or one-time operations around a given property. In fact, in the construction industry, most of the time a piece of equipment is rented if it isn’t used throughout the entire course of the construction project because it is simply cheaper to rent it versus buy it. Having equipment rental services makes it possible for people to use a piece of equipment for a fixed term for less than buying it. Even individuals use equipment rentals when, for example, splitting and chopping wood on their property once during the year.
It is very common for companies to use an equipment lease agreement template not just for simple things like how long someone is allowed to rent a piece of equipment, but what they will do in the event that the rented equipment is damaged. In the event of such damages, language in the contract might state that the lessee agrees to cover any attorneys fees from legal proceedings or pay the company the market value of that particular piece of equipment if they break it.
Anyone who is renting equipment from a company or an individual, or on the other end renting a piece of equipment out to a company or an individual, should use an equipment rental agreement template doc.
Writing an equipment lease agreement on your own might not be feasible or simply might not be something your company wants to do. You also may not want to do this, especially if you are just renting a piece of equipment for a single task. In these cases, having a document or a template you can use makes it much easier to just fill out the appropriate parts and have a legally binding agreement.
Some examples of when you should use an equipment rental agreement template include the following:
If you are thinking of starting a company renting out equipment, there are a few steps you need to follow.
The first is to get to know your market. If there are already three companies in the local area renting out equipment, you might consider renting different equipment to set yourself apart. You also need to get to know what is in demand in your area. If there are only companies currently renting construction equipment or general landscaping maintenance equipment, there might be a reason for that. Check the local area to see if there are any hospitals or large IT companies or office buildings. If there aren’t a lot of offices, it won’t really be beneficial to start a company that rents office equipment or IT supplies.
After you get to know your market and you know what type of equipment rental is best suited for your area, then it’s time topurchase that equipment. Make sure that part of your research into the local market is understanding how much equipment you should purchase at any given time, and what type of equipment you should purchase.
From there it’s up to you to market your equipment, just the same as you would market any other new company in an area.
From there, create and sign your rental agreements. Each agreement should have the sections that apply to the equipment you are renting. Before you rent it to each customer, make sure both parties sign it and are aware of all of the terms in the document.
Maintain your equipment. Make sure that your rental agreements include a free equipment rental agreement template form that and ensure that it states the equipment has to be maintained by the person who rents it. This might include cleaning the equipment, using things like oil through the shredder, or whatever applies to your equipment. Then it’s up to you to make sure that you maintain the equipment on your end in between renting it to different customers.
Include the names of the lessor and lessee as well as the date. In the same section, you want to identify what equipment you are renting, and provide a description.
Include whether this is a fixed lease or a month-to-month lease. In this section, you can also list the rental fee and specify if it must be paid upfront, per week, per month, or per day. Include any rent instructions, such as how the payment is to be made, what the late fees are, and information regarding the security deposit.
Include a section that explains how the equipment will be delivered or accepted. You can specify that the user takes the equipment from your facility and it’s up to them to inspect it beforehand to identify any discrepancies or problems. Then state that the person has to deliver it back or that your company will pick it up, depending on what you choose.
Have an area that covers maintenance and what types of repairs or maintenance has to be conducted to the equipment. You can also include a section about the risk of loss or damage here that stipulates whether the person renting assumes all of the risk from loss or damage to the equipment.
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The main difference between a lease and a rental agreement for equipment is the length of time. A rental agreement is usually much shorter, typically covering 30 days or less. So, if an individual or a company is renting a piece of equipment for just a few days or a week, they might use a rental agreement whereas if that same individual or company is renting a piece of equipment for a few months, usually six months or longer, then they might use a lease agreement which has sections to account for the extra time, levels of reasonable control while the equipment is in their care, and any other important information.
If you download a word doc or PDF, or write your own contract, you can cover just about any type of equipment rentals, including MRI machines, x-ray machines, refrigerators, broilers, ovens, plow trucks, generators, garbage trucks, machining tools, plasma cutters, cranes, bulldozers, dump trucks, loaders, wood splitters, excavators, servers, monitors, projectors, laptop, office equipment, power wheelchairs, stair lifts, and more. Anything that is a piece of equipment that you are renting from someone else or you are renting to someone else can be covered under this contract.
Legally you can put this anywhere you want in your document. If you use a template, it will likely already be included, but you can always add it into the section that covers payments.