LEASE SERVICING 101
High-quality portfolio management is exceptionally important when it comes to leases due to their complexity and the specific nuances of each individual portfolio. Whether you are looking at a standard book of auto leases or a highly customized commercial equipment lease deal, servicing leases requires deep experience and critical attention to detail to ensure that these B2B assets are properly managed and tracked. As experts with over 30 years of experience in this complicated space, Vervent’s cradle-to-grave service covers all the unique support needs of lessors.
Collateral is fundamental to leasing and therefore plays one of the largest roles in successful portfolio servicing. Detailed consumer information is collected from lessees and kept current for each asset for use in insurance, tax and UCC filings. On behalf of lessors, Vervent tracks every single asset, no matter the size.
From state to county, the details of tax reporting are many. Sales (or use) and property taxes are incredibly complicated and must be precise for each asset within a portfolio. Vervent relies on more than 30 years of experience and proven processes to ensure accuracy when filing on behalf of guarantors. Dedicated teams work diligently to keep detailed records to provide accurate monthly use tax statements and annual property tax statements to clients.
The Uniform Commercial Code governs commercial transactions relating to the sale or transfer of property. UCC filings are crucial to proving ownership of an asset. As such, it is a significant part of commercial lease servicing. After the lessor makes the initial filing, Vervent assumes the responsibility for complying with all UCC regulations and registering any ownership updates.
Part of cradle-to-grave service includes managing insurance for each asset, including making payments and handling claims. This is a highly complex component of servicing that requires special skills to execute the detailed policy specificity and ongoing maintenance. Vervent tracks and updates insurance records across the life of each lease, sends reports to clients monthly and keeps a full history available for clients over the life of the lease.
End of Terms Management
Options for the end of the lease term are typically defined within the lease at origination and include renewing the lease, returning the asset and purchasing the asset by paying off the residual balance. Vervent’s unmatched processes acutely follow maturing leases to properly notify lessees of their end of term options and facilitate next steps.
Repossession and Remarketing
Following the return of a leased asset, the lessor may be called upon to sell the equipment. Vervent handles repossession and remarketing of assets with an unparalleled track record for successful resale.
Commercial Credit Bureau Reporting
With commercial lease portfolios, Vervent handles all commercial credit bureau reporting and filings on behalf of guarantors.
As with any transaction, customer service is an important factor in servicing a portfolio of leases. Vervent is prepared to educate clients about sales and property taxes, the interest and principal components of a lease, and how invoices differ from loan contracts. We are also standing by to facilitate service communication to lessees if needed to ensure the successful continuation or closing of a lease for our partners.