Dealers or manufacturers may require advance deposits ranging from 10% to 100% of the total cost when placing orders for their equipment. Equipment lessors can provide this advance funding via two addendums to the lease, Progress Payment or Pre-Funding, that hold the lessor harmless for any problems with the equipment not arriving or not working properly.The Progress Payment Addendum acts as an “acceptance” of the lease and its terms. The lease commences and monthly payments are due per the contract. The lessor can then advance payments to the dealer or manufacturer per their terms. An example would be a vendor that requires 30% with purchase order, 60% paid prior to shipment and the remaining 10% upon delivery.A Pre-Funding Addendum allows the lessor to advance payment to a vendor and holds the lessee responsible should the lease not commence. The lessee returns any payments lessor made to vendor, if the lease does not commence. The lessee also pays a pro rated lease payment until the lease funds.How Pre-Funding charges are calculated:Lessor advances 50% of a $100,000 lease and the monthly lease payment is $2,125.