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Rental contract

An agreement under which a homeowner pays monthly fees for the use of equipment owned by the supplier. The standard Ontario water heater rental and the structure most door-to-door HVAC operators use.

Rental contracts shift ownership risk and capital cost to the supplier, in exchange for long terms (often 10-20 years) and monthly fees that cumulatively exceed the equipment's installed value many times over.

Cancellation typically requires a buyout calculated from an internal depreciation schedule. Where the underlying terms are unconscionable or the original sale was unfair, the contract may be challengeable.

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