C22-~Lancaster Farming, Saturday, May 24,1980 Review those leasing options LniTZ Wrong decisions which are made now on leasing deals can show up as losses on the profit sheet later. Ira Dumont Gouge, President of Baldwin - United Leasing said that, “tight money and high in terest rates are causing many farmers to consider leasing as an alternative to equipment purchase”. The executive went on to point out that, “while leasmg is a very good management tool for farmers, careful at tention should be given to the conditions and terms which are written into contracts”. He said not all contracts are leases which will be allowed by IRS. “Conditional Sales Con tracts are often confused with leases because the terms of the contract, not the words ‘lease agreement’, determine what is (or is not) a ‘true’ lease in the opinion of the Internal Revenue Service”, says Gouge. “The result is that farmers can be denied the financial privileges which are allowed m true leasing if they unknowingly enter mto an arrangement which con stitutes a conditional sales contract.” Gouge and Paul F. Bachman, Vice President of the Ag Leasing Division made the announcement Monday following what they describe as “a mass con sideration of leasing by the nation’s farmers”. They noted inquiries directed to Baldwin-United have escalated at un precedented rates, an in dication that other sources in 'the industry are also receiving an upsurge of interest from farmers. “We’re concerned that many farmers are entering mto equipment contracts which are not beneficial for them in the long run”, says Bachman. He went on to point out that within the last 30 days stepped up programs The Steel Building Experts Providing quality steel buildings at the lowest possi ble cost is our business. We have experienced people on staff who are well qualified to execute your building plans. NEE-LEE BUILDINGS ★ For machinery storage ★ Farm shop ★ Livestock, crop storage ★ Combination uses AUTHORIZED DEALER: ZINN BUILDERS, INC. 1408 Marene Drive Harrisburg, PA 17109 717-545-0231 Charles H. Zinn for leasmg arrangements, conditional sales contracts and plain rental programs have been launced by equipment manufacturers, and other credit sources. Gouge and Bachman further pomt out that, the majority of these programs are not ‘true’ leases because they offer minimum options which are substantially below fair market value. When IRS comes calling, these sources will say ‘we made a mistake’. “Knowing who you are dealing with is more im portant today than it has ever been in the past. Many leasing companies are curtailing their operations, selling off their leases or not taking any leases because they do not have sufficient funds. As a result of economic conditions, many of the fast buck operators have moved into financing and leasmg, while promising the moon and stars with their foreign oil or German contract. “You’D lose that deposit or the sale if the leasing company connot perform at closing ... so when they start checking you out, you should be checking them out. Remember, it’s your money,” Gouge said. He concluded that, while rate is an important factor in a lease, it is not the most important because it is not uncommon to have organizations to “low baU” the rate and then continue to return to re-negotiate. “This is especiaUy true in view of the current, volatile state of interest rates”, concluded Gouge. Bachman, who heads marketing operations for the firm confirmed that leasing activity through the com pany is currently higher than the amount which was projected year-io-date for 1980. “We’ve established firm guidelines m our true leasmg considerations which help to assure that our clients are • FARM BUILDINGS • COMMERCIAL BUILDINGS • INDUSTRIAL BUILDINGS doing the right thing”, said Bachman. “While we certainly wantt leasing business”, said Bachman, “we’re not willing to take it at the expense of the farmer. We would have to live with that mistake later on when difficulties arose”. Thus, he indicated that aU lease applications are being reviewed in light of long-term soundness. “Panic measures taken by a farmer now, might not be right for him in a few months”, says Bachman. “We’re doing aU we can to serve farmer’s equipment needs, but we want clients who wiD stay ... not clients who wiD suffer m the future if we misguide them in leasing decisions”. The executives concluded their leasing obervations by The new Pati XH link and drive unit gives you extra performance over the long haul Standard over 2 lbs. HA4816 DISTRICT MANAGER GEORGE HEATH 472 Woodcrest Dr. Mechanicsburg, PA 17055 717-737-0002 iXANDRIA MAX ISENBERG 814-669-4027 BALLY LONGACRE ELECTRIC 215-845-2261 LUCAS BARN EQUIPMENT 814-383-2806 BELLEVII MAC LAY t SON 717-935-2101 CAMP HILL LLOYD SULTZBAUGH 717-737-4554 CHAMBERSBURG CUMBERLAND FARM & DAIRY INC 717-263-1965 ELLIOTT: ;burg CARL BAER 717-582-2648 Feeder pig brochure DES MOINES, la. - The Starting of Feeder Pigs is the title of a newly published brochure being made available through cooperative efforts of National Pork Producer Council’s Feeder Pig saymg that farmers should involve their CPA’s, bankers and others as they consider leasing and/or conditional sales contracts. “Short range and long range im plications of such decisions should be considered, regardless of current economic conditions”, they say. HAMBURG SHARTLESVILLE FARM SERVICE 215-488-1025 LEBANON MARVIN J. HORST DAIRY EQUIPMENT 717-272-0871 McALISTERVILLI SANER FARM SYSTEMS 717-463-2606 MILLERSBURG LANDIS LABOR SAVERS 717-692-4647 MILTON LANDIS FARMSTEAD AUTOMATION 717-437-2375 PIPERSVI MOYER FARM SERVICE 215-766-8675 available Committee, the National Feeder Pig Marketing Association and American Association of Swine Pracitioners. The brochure, prepared with assistance of veterinarians, feeder pig dealers, feed manufac turers, university extension personnel and others, offers recommendation for feeder pig buyers and those in positions to supervise starting of feeder pigs. Copies of the brochure, available at 10 cents each, may be ordered from NPPC, P.O. Box 10383, Des Moines, IA 50306 You can depend on Patz Pound, Wisconsin 54161 XH drive unit Patz dealer. OUARRYVILLE UNICORN FARM SERVICE JAMES E. LANDIS 717-786-4158 TERRE HILL TERRE HILL SILO CO. INC. 215-445-6736 WILLIAMSBURG LONGENECKERS. INC 814-793-3731 MARYLAND DEALERS HAGERSTOWN. MD TRI-STATE FARM AUTOMATION 301-790-3698 KENNEDYVILLE. MD BINDER SERVICE CO. 301-348-5263 LINEBORO. MD WERTZ GARAGE, INC 301-374-2672 STREET. MD P & S EQUIPMENT. INC
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