[Code of Federal Regulations]

[Title 12, Volume 6]

[Revised as of January 1, 2006]

From the U.S. Government Printing Office via GPO Access

[CITE: 12CFR714.5]



[Page 533]

 

                       TITLE 12--BANKS AND BANKING

 

            CHAPTER VII--NATIONAL CREDIT UNION ADMINISTRATION

 

PART 714_LEASING--Table of Contents

 

Sec. 714.5  What is required if you rely on an estimated residual value 

greater than 25% of the original cost of the leased property?



    If the amount of the estimated residual value you rely upon to 

satisfy the full payout lease requirement of Sec. 714.4(b) exceeds 25% 

of the original cost of the leased property, a financially capable party 

must guarantee the excess. The guarantor may be the manufacturer. The 

guarantor may also be an insurance company with an A.M. Best rating of 

at least a B+, or with at least the equivalent of an A.M. Best B+ rating 

from another major rating company. You must obtain or have on file 

financial documentation demonstrating that the guarantor has the 

resources to meet the guarantee.