Purchase Reserve is a method to "effectively apply" extra cash upfront to the cash price that was developed by the National Barn & Storage Rental Association (www.nbsra.com).
If this feature is enabled extra money paid down can be applied to purchase reserve to reduce the rental payment amount. The purchase reserve is almost the same as a deposit, except it is used to reduce the payment on the agreement. Also the purchase reserve amount cannot be added to later, it has to be paid up front. It is not taxed until the agreement is paid out and it is refundable to the customer in the event of return of merchandise (minus any back rent and other charges due).
To have a separate agreement for agreements with Purchase Reserve you must save a file named "PR-Agreement.rtf" in your "RTOwin\Docs" folder on your server computer for RTO Pro. If that file is present it will be the agreement printed when you load an agreement with Purchase Reserve. New contract fields are now available for the Purchase Reserve feature to print the reduced payment amount, regular payment amount, regular contract amount, the purchase reserve discounted contract and payment amounts.
When using this feature, the extra down payment (Purchase Reserve), is handled like a deposit. It is not revenue and not taxed until it is applied to the payoff of the contract. So at the time of payoff the purchase reserve will be taxed. If the customer decides to return the merchandise you would refund the purchase reserve amount minus any back rent or fees the customer has due, the same as you would a deposit.
When using this feature all agreements with purchase reserve should be paid out through early payoff, they can not be allowed to go to full term.
To see a sample agreement for purchase reserve see the files at the links below:
More information is not currently available about this feature, contact tech support or NBSRA @ www.nbsra.com for more details.
Please note before enabling this feature: If you had the box checked to keep track of extra down payments and loaded agreements with extra down payments, then un-check that box and check the use purchase reserve box, those contracts loaded with extra down payment would be incorrectly handled as if it was purchase reserve paid down.
RTO Pro Software does not provide legal advice and makes no representation nor assurance as to the legality or adequacy of any of the features in RTO Pro. RTO Pro Software urges you to obtain a legal opinion from your counsel as to specific regulations in the states and country in which you operate. This advice should be updated annually.