Most people’s expectations when they want to lease a copier are pretty straightforward. They want a copier to simplify operations and increase the efficiency of the office. Seems simple enough, right? Unfortunately, many steps go into leasing a copier that is not common knowledge, and you can often find yourself agreeing to terms and conditions that you were not expecting. To shed some light on this subject, here are what we think are five essential tips that every business owner or office manager should know.


1 – Be Mindful of Automatic Renewals

Many, if not most, companies that lease a copier are operating under the false understanding that their copier lease will automatically end once it reaches the end of the term. The fact of the matter is that a copier lease never ends until the lessee contacts the lease company to notify them that they do not wish to enter a renewal and then chooses one of the three alternative options that are available once the copier lease reaches the maturity date, i.e., the date the copier concludes the original lease term. To avoid entering an automatic renewal, it is imperative that you provide timely notification to the lease company instructing them not to enter you into renewal and then choose one of the three other available options available to you.

What Are My Options When My Copier Lease Is Nearing Its EndCommon Sense Business Solutions | What Are My Options When My Copier Lease Is Nearing Its End

I would pose an example to clarify: If a company signed a copier lease on August 1, 2022, and the lease term is 60 months, the maturity date for that lease is August 1, 2027. The terms of a copier lease vary slightly. Still, for the most part, the following is uniformly accurate: The lessee is required to notify the lease company of their intention to choose one of 3 options within 30-90 days from the copier lease maturity date, and in lieu of this notification, the copier lease will automatically enter a renewal, either on a month to month basis or for an entire year based on terms of the specific lease you sign. The lease will perpetually renew until such time as you choose one of the other three options outlined below. By notifying the lease company that you do not wish to renew, you will avoid this automatic renewal event and can choose one of 3 other options.

Option #1 – Terminate the lease and return the copier

If you have given notice to avoid renewal, the lessee can end the copier lease and return the copier to the location designated by the lease company. The lessee is responsible for shipping the equipment to the designated location within the allocated time indicated in the Return Authorization instructions provided by the lease company.

Option #2 – Upgrade to a new copier on a new lease

As you approach the maturity date on your copier lease, you will almost certainly receive an offer from your existing copier provider to upgrade to a newer copier on a new lease agreement. If you accept this upgrade, the copier provider will generally pick up and return the existing machine to the lease company on the lessee’s behalf, thus eliminating the need for the lessee to incur any expense for returning the existing copier. In most cases, your existing lease provider will make this seamless by providing a newer machine with a comparable monthly payment to your existing lease, picking up your existing copier upon delivery of your new copier, and assuming all responsibilities and expenses to ship back your existing machine. This is the most common and recommended option, with the caveat that you are satisfied with your current copier provider.

Option 3 – Purchase the copier and own it outright

Most copier leases have a Fair Market Value Buyout option allowing the lessee to purchase the copier at the end of the term for the fair market value of the machine. The value of the machine is not determined until the lessee requests a buyout to keep quote, after which the lease company will provide a quote to the lessee. Based on my 35 years of experience in the copier industry, I will offer that on a 5-year lease, the fair market value of the copier is approximately 10 – 12% of the original equipment cost at the time the lease began, and on a 3-year lease, the fair market value of the copier is approximately 15 – 20% of the original equipment cost.


2 – Late Payment FeesCommon Sense Business Solutions | Try To Avoid Late Fees

When you choose to lease a copier, you will likely be pleasantly surprised to learn that the total accumulation of your payments likely won’t be much more than the total cost to purchase a copier. Lease companies provide outstanding rates for the use of their money over a 3- or 5-year copier lease. These same lease companies add to their bottom line through seemingly small but maddening surcharges such as late fees and insurance surcharges (see paragraph below.) Every copier lease I have seen during my 35 years has a very short window between the time your bill is received and the date it is due, and the late charges are higher than most would expect. You may have a $100.00 a month lease payment, but if you pay late every month, you can pay $15.00 – $20.00 every month in late charges. The way to avoid this unnecessary charge is to pay your lease invoice immediately upon receipt, or better yet, set up auto-pay to make sure you’re not paying more than necessary.

3 – Insurance Surcharges

When you lease a copier, you are required to add the lease company as the sole loss payee for the value of the copier being leased. In virtually every case, you can add the copier to your existing business insurance with just a quick call to your agent, and in most cases, it will not increase your insurance rate at all. However, suppose you neglect to have the copier added to your existing insurance. In that case, the lease company will charge you an insurance surcharge of $5.00 – $10.00 a month to cover the insurance of the copier you are leasing.

4 – Copier Shipping Fees

If you terminate your lease at the end of the term, you as the lessee are responsible for having the copier shipped back to the lease company at your expense. (If you upgrade to a new copier, the company providing the new copier will frequently ship the copier on your behalf.) The way it works is that when you notify the lease company that you will be terminating the lease at the scheduled end of the term, they will make a note to send you what’s called a Return Authorization which is a fancy way to say shipping instructions. These instructions will direct you on where the copier needs to be shipped and the date it needs to be received to avoid financial penalties. The copier leasing company will also provide a “preferred shipping partner,” which, in our experience, is generally with a company that will charge you a premium compared to what you can expect to pay on the market. As the lessee, you are able to choose any shipping company you want, and I would encourage you to find your own shipping company as it will likely be considerably less expensive than using the shipper provided by the lease company.

5 – Annual Cost Increases

When you lease a copier, the company you choose to get the copier through has the option of adding annual price increases into the monthly payment, and they can determine the amount of these increases. Obviously, unnecessary price increases are something you want to avoid when leasing a copier. We do not add annual increases into our leases, but many companies do, and as a consumer, we encourage you to ask this question when doing your shopping to avoid these annual price hikes in your copier lease payment.

In summary, the information contained in this blog may give you a reason to pause as you consider whether you want to lease a copier. We, however, feel that leasing a copier is more favorable than purchasing a copier, and approximately 85% of all copiers are leased. Our suggestion is that you simply avoid these unnecessary pitfalls by understanding the automatic renewal process, setting up auto-pay to avoid late payments, adding the copier to your existing insurance to avoid insurance surcharges, confirm that the copier lease you are considering does not have built-in price increases and finally, ask your copier provider if they are willing to assume the shipping costs on your behalf if you lease your next copier with their company.