Situation One – you buy equipment for $28,000 that performs an essential function and that requires some form of service (this may be fuel, electricity, or other form of service). Since the service provider is offering significant savings on the cost of the service if you pay for it up front, in a lump sum, you decide to prepay $12,000 for the services over the next four years. Unfortunately, after 18 months, the service provider goes out of business.
1. Who do you blame for this mess?
2. Do you seek legal redress and, if so, from whom?
Situation Two – same situation as One, except you buy the equipment by borrowing $28,000 from the bank, payable at $700 per month over the next 48 months. You also decide to prepay $12,000 for the services over the next four years. After 18 months, the service provider goes out of business.
1. Who do you blame for this mess?
2. Do you seek legal redress and, if so, from whom?
Do you continue to pay the bank loan on the equipment, even though it does not work without the service?
