What is Lease and its Benefits?

Hello CEans, I just attended a webseminar regarding leasing ,which it comes in the Banking and Financial domain ,though we guys generally not from the finance background but we need to know about the financial terms and the role of this. So here i am starting with some Leasing definition and what it is all about .

LEASE:

A lease is a contractual agreement between the lessor (owner) and the lessee (second party) for a specified asset, which can be property, a house or apartment,business or office equipment, an automobile or even a horse. The lessee receives the right to total ownership for a spelled out period of time and conditions in return for payments. Do not confuse a lease with a rental, although these words are often interchanged. A rental is for a short period of time, such as a month, where, in this case, the agreement is renewed or the terms are changed monthly.

Lessor: [FONT=TrebuchetMS, sans-serif]The person making the grant is called the LESSOR[/FONT]
Lessee: [FONT=TrebuchetMS, sans-serif]The person receiving the grant is called the LESSEE.[/FONT]


What is Leasing all about:
Suppose you have to Start your own business and you want some assets including the building ,furniture and you have not enough money to buy all equipments. so by making some agreements between the Lessor and Lessee.the Lessee can get all the use of equipments by leasing them.

before going into the Depth we need to know the diffrence between Leasing and Renting
as these are the similar terms we often confused.

In the Lease first we all have to know that the Leasing agreement,we have the option to gain the ownership as the contract expired or the product economic life is about to finish.


Repairing and Maintenance Benefits.

Every residential or commercial property needs repairing or maintenance from time to time, and this is the responsibility that belongs to the homeowner. In case of Renting, the owner of the home will be responsible for all the repairing and maintenance work needed and the renter will have no responsibility. The renter may call the homeowner anytime for any repairing or maintenance work such as a leak in toilet or bathroom but on the other hand, the Lessee will be responsible for the repairing and maintenance work and the owner of the home in this case cannot be called for any of the repairing or maintenance work. The Lessees will also do the work of repairing and maintenance very happily because they will be the next owner of the home they are living in.

Payment Benefits

The payment procedure of the Lease Purchase Agreement is such that both parties are equally benefited. The homeowners benefit from the payment procedure because they get paid monthly as decided in the agreement and the monthly payment that they get is more than the monthly rent then they would have received if the property was given on the rent basis. The payment from the tenant to the homeowner in this arrangement is also called Option fee.
One more payment benefit to the homeowner is that the Option fee is non refundable so if the tenant is not able to pay the remaining amount at the time of contract expiry then the tenant will not get their payment in full or part. The payment benefits are not only for the homeowners but these are also for the tenants. The payment benefit to the tenant is that the part of their payment work towards reducing the final purchase price of the property. So at the time of contract expiry, the final amount will be highly reduced and this would be much helpful for the tenants to become the buyer.

some of the materials i have covererd from Source: ezinearticles.com

I will post some more information soon ,regarding the types of leases and related some terms,please post your valuable suggestions here.

PS: I am new in this field,and i am trying my best to give the knowledge as much I can .😁