Lease

AAA

DEFINITION of 'Lease '

A legal document outlining the terms under which one party agrees to rent property from another party. A lease guarantees the lessee (the renter) use of an asset and guarantees the lessor (the property owner) regular payments from the lessee for a specified number of months or years. Both the lessee and the lessor must uphold the terms of the contract for the lease to remain valid.

INVESTOPEDIA EXPLAINS 'Lease '

Leases are the contracts that lay out the details of rental agreements in the real estate market. For example, if you want to rent an apartment, the lease will describe how much the monthly rent is, when it is due, what will happen if you don't pay, how much of a security deposit is required, the duration of the lease, whether you are allowed to have pets, how many occupants may live in the unit and any other essential information. The landlord will require you to sign the lease before you can occupy the property as a tenant.

RELATED TERMS
  1. Fixed Price Purchase Option

    The right, but not the obligation, to buy a leased item at a ...
  2. Capitalized Cost Reduction

    Any upfront payment that reduces the cost of financing. Capitalized ...
  3. Capital Lease

    A lease considered to have the economic characteristics of asset ...
  4. Graduated Lease

    A type of long-term, typically for commercial property, lease ...
  5. Leaseback

    An arrangement where the seller of an asset leases back the same ...
  6. Lessee

    The person who rents land or property from a lessor. The lessee ...
Related Articles
  1. Retirement

    Should You Buy Property On Leased Land?

    Find out what to consider before investing in a leased-land property.
  2. Home & Auto

    Tips For The Prospective Landlord

    Investing in rental property can generate serious income, but there's more to it than collecting rent.
  3. Personal Finance

    A Career In Real Estate Portfolio Management

    Find out why this job more closely resembles the role of a CEO than an asset manager.
  4. Home & Auto

    New Wheels: Lease Or Buy?

    These two major ways to obtain a car have very different advantages and drawbacks. Find out which is best for you.
  5. Personal Finance

    6 Tips For Renting An Apartment

    Find out what you can do to find a fabulous apartment to fit your budget.
  6. Taxes

    Tax Deductions For Rental Property Owners

    Besides creating ongoing income and capital appreciation, real estate provides deductions that can reduce the income tax on your profits.
  7. Home & Auto

    Simple Ways To Invest In Real Estate

    Owning property isn't always easy, but there are plenty of perks. Find out how to buy in.
  8. Entrepreneurship

    The CEO Dream Team - Walton, Schwab, Marcus And Blank

    The successes of these three CEOs can be linked back to one common factor: customer service.
  9. Options & Futures

    Electrifying Apartment Bills: How To Reduce Them

    As a renter, there are still factors that can influence your heating and air conditioning bill.
  10. Credit & Loans

    Will filing bankruptcy stop an eviction?

    Learn about how filing bankruptcy can affect an eviction process, and find out what recourse your landlord has if you file bankruptcy.

You May Also Like

Hot Definitions
  1. Command Economy

    A system where the government, rather than the free market, determines what goods should be produced, how much should be ...
  2. Prospectus

    A formal legal document, which is required by and filed with the Securities and Exchange Commission, that provides details ...
  3. Treasury Bond - T-Bond

    A marketable, fixed-interest U.S. government debt security with a maturity of more than 10 years. Treasury bonds make interest ...
  4. Weight Of Ice, Snow Or Sleet Insurance

    Financial protection against damage caused to property by winter weather specifically, damage caused if a roof caves in because ...
  5. Weather Insurance

    A type of protection against a financial loss that may be incurred because of rain, snow, storms, wind, fog, undesirable ...
  6. Portfolio Turnover

    A measure of how frequently assets within a fund are bought and sold by the managers. Portfolio turnover is calculated by ...
Trading Center