Lessee

What is a 'Lessee'

A lessee is the person who rents land or property from a lessor. The lessee is also known as the "tenant", and must uphold specific obligations as defined in the lease agreement and by law. The lease is a legally binding document, and if the lessee violates its terms, he or she could be evicted.

BREAKING DOWN 'Lessee'

The lessee's rights include the right to privacy, the right to basic standards of habitability such as water, electricity and heat and the right to live in a space that complies with local building codes.


The lessor's rights include the right to screen potential tenants, the right to know and approve of who is occupying the leased unit and the right to use part or all of the tenant's security deposit to repair any damage caused to the property by the lessee. The lessor's responsibilities include complying with health and safety codes, making necessary repairs, returning a fair amount of the tenant's security deposit when the lease is terminated and providing advance notice to the tenant if it will be necessary to enter the unit.

RELATED TERMS
  1. Lease

    A legal document outlining the terms under which one party agrees ...
  2. Lessor

    The owner of an asset that is leased under an agreement to the ...
  3. Leveraged Lease

    A lease agreement that is partially financed by the lessor through ...
  4. True Lease

    A specific type of multi-year lease which does not pass on ownership ...
  5. Land Lease Option

    An option within a lease contract that grants the lessee the ...
  6. Triple Net Lease

    A lease agreement that designates the lessee (the tenant) as ...
Related Articles
  1. Personal Finance

    How Does a Lease Work?

    A lease is an agreement between two parties where the lessor owns property that it allows the lessee to use pursuant to terms of the agreement.
  2. Personal Finance

    Who is a Lessor?

    A lessor is the owner of an asset that is leased.
  3. Personal Finance

    The Complete Guide To Becoming A Landlord: Landlord-Tenant Relationship

    A lease establishes the relationship of landlord and tenant and is both a conveyance of a possessory estate in real property and a contract between the parties. Through the lease, the tenant ...
  4. Personal Finance

    How Does a Modified Gross Lease Work?

    A modified gross lease is a rental agreement where, in addition to their rent, tenants pay a share of other costs associated with the property.
  5. Investing

    How Does an Operating Lease Work?

    Operating lease is a term used mostly in accounting to denote a lease that gives the lessee rights to use and operate an asset without ownership.
  6. Personal Finance

    Millennials Guide: How To Read a Lease

    Everything you need to know before you rent a home.
  7. Personal Finance

    The Complete Guide To Becoming A Landlord: Finding Tenants

    A challenge that most landlords face is finding reliable tenants to fill their rental properties. Ideally, a tenant will be willing and able to pay his or her rent in full and on time each month, ...
  8. Managing Wealth

    What is a Capital Lease?

    A lease considered to have the economic characteristics of asset ownership.
  9. Personal Finance

    Why You Should Buy A Car Instead Of Leasing

    While leasing has certain advantages, buying a car tends to save you money in the long run and offers greater flexibility.
  10. Personal Finance

    3 Things to Consider When Renting By the Room

    Although renting by the room can increase returns on rental property, it does come with a few caveats.
RELATED FAQS
  1. At the beginning of the year, ABC Corp. began to lease a major piece of equipment ...

    The correct answer is: A) Under the capitalized lease method, the lessee must treat the asset as if it was purchased with ... Read Answer >>
  2. What are the differences between single, double and triple-net leases?

    Learn the ins and outs of net lease agreements, including the key differences between single net, double net and triple net ... Read Answer >>
  3. What are the three "nets" of an NNN lease?

    Learn what the three "nets" are in an NNN lease and how they affect the responsibilities of both landlord and tenant in a ... Read Answer >>
  4. What kinds of real estate transactions use triple net (NNN) leases?

    Learn how a net-net-net or triple net lease works and why it is popular in commercial real estate transactions. It is also ... Read Answer >>
  5. How does the value of the real estate impact the value of a triple net (NNN) lease?

    Understand how the value of the real estate involved in a triple-net lease impacts the value of the lease both positively ... Read Answer >>
  6. Why might a bond agreement limit the amount of assets that the firm can lease?

    Bond covenants can limit the amount of leases a company can have because leasing contracts are a form of debt. Taking on ... Read Answer >>
Trading Center