1

lease

play
noun \ˈlēs\
Updated on: 26 Jul 2017

Definition of lease

  1. 1 :  a contract by which one conveys real estate, equipment, or facilities for a specified term and for a specified rent took out a five-year lease on the house; also :  the act of such conveyance or the term for which it is made

  2. 2 :  a piece of land or property that is leased

  3. 3 :  a continuance or opportunity for continuance a new lease on life

Examples of lease in a Sentence

  1. They took out a five-year lease on the house.

  2. We hold leases on both of our cars.

Recent Examples of lease from the Web

These example sentences are selected automatically from various online news sources to reflect current usage of the word 'lease.' Views expressed in the examples do not represent the opinion of Merriam-Webster or its editors. Send us feedback.

Origin and Etymology of lease

Middle English les, from Anglo-French, from lesser


2

lease

verb

Definition of lease

leased

;

leasing

  1. transitive verb
  2. 1 :  to grant by lease

  3. 2 :  to hold under a lease

leasable

play \ˈlē-sə-bəl\ adjective

Examples of lease in a Sentence

  1. She leases a red convertible.

  2. I have leased this house for the last four years.

  3. We leased the house to a young married couple.

Recent Examples of lease from the Web

These example sentences are selected automatically from various online news sources to reflect current usage of the word 'lease.' Views expressed in the examples do not represent the opinion of Merriam-Webster or its editors. Send us feedback.

Origin and Etymology of lease

Anglo-French lesser, laisser, lescher to leave, hand over, lease, from Latin laxare to loosen, from laxus slack — more at slack

Synonym Discussion of lease

hire, let, lease, rent, charter mean to engage or grant for use at a price. hire and let, strictly speaking, are complementary terms, hire implying the act of engaging or taking for use and let the granting of use. we hired a car for the summer decided to let the cottage to a young couple lease strictly implies a letting under the terms of a contract but is often applied to hiring on a lease. the diplomat leased an apartment for a year rent stresses the payment of money for the full use of property and may imply either hiring or letting. instead of buying a house, they decided to rent will not rent to families with children charter applies to the hiring or letting of a vehicle usually for exclusive use. charter a bus to go to the game

Financial Definition of LEASE

lease

What It Is

A lease is an agreement, usually in writing, between the owner of an asset and a lessee.

How It Works

Leases can be for a variety of assets, though real estate often comes to mind first. For example, let's say John Doe owns a house on Main Street. He does not live in the house; he decides to lease it to Jane Smith. John continues to be the owner of the house, but Jane agrees to pay John $800 a month in return for letting her live there for a year. They type up a lease, which sets forth the exact dates Jane can live in the home, what improvements or changes Jane is allowed to make to the home, and what happens if Jane damages the home.

Leases can also be for cars, manufacturing equipment, office space, photocopiers, musical instruments, solar panels, or virtually any other asset. Generally, leases are handy when one party has the capital to purchase the asset and another party does not have the capital to do so but would like access to the asset.

Why It Matters

There are many kinds of leases. Some allow the lessee to buy the asset at the end of the lease term, some do not, for example. Regardless, a lease is a legal contract, and violating a lease can result in monetary damages or other remedy by a court. Generally speaking, leases set forth the lease dates, the payments required, and guarantees that the lessor actually owns the asset that he or she is leasing to the lessee.

Accounting for leases can be complicated. There are two general types: operating leases and capital leases. An operating lease is simply a lease on an asset that does not give the lessee rights similar to those of an owner of the asset. Generally, lease payments made under a capital lease go on the income statement and thus reduce profits.

A capital lease is the opposite—it gives the lessee rights similar to those of an owner of the asset. Generally, lease payments made under a capital lease are recorded on the balance sheet and thus do not reduce profits.

GAAP rules state that to determine whether the lease is an operating lease, the lease must not have any of these characteristics:



LEASE Defined for English Language Learners

lease

play
noun

Definition of lease for English Language Learners

  • : a legal agreement that lets someone use a car, house, etc., for a period of time in return for payment

lease

verb

Definition of lease for English Language Learners

  • : to use (something) for a period of time in return for payment

  • : to allow someone to use (something) for a period of time in return for payment


LEASE Defined for Kids

1

lease

play
noun \ˈlēs\

Definition of lease for Students

  1. 1 :  an agreement by which a person exchanges property (as a car or house) for a period of time in return for payment or services

  2. 2 :  a piece of property that is leased


2

lease

play
verb

Definition of lease for Students

leased

;

leasing

  1. :  to give or get the use of (property) in return for payment or services


Law Dictionary

1

lease

play
noun \ˈlēs\

Legal Definition of lease

  1. 1a :  a contract by which an owner of property conveys exclusive possession, control, use, or enjoyment of it for a specified rent and a specified term after which the property reverts to the owner; also :  the act of such conveyance or the term for which it is made — see also sublease — compare easement, license, security interest at interest 1, tenancy Editor's note: Article 2A of the Uniform Commercial Code, which governs leases where adopted, defines lease as “a transfer of the right to possession and use of goods for a term in return for consideration.” building lease :  ground lease in this entry consumer lease :  a lease made by a lessor regularly engaged in the selling or leasing of a product to a lessee who is leasing the product primarily for his or her personal or household use finance lease :  a lease in which the lessor acquires goods from a supplier in accordance with the specifications of the lessee Editor's note: Under section 2A-103 of the Uniform Commercial Code, before the lessor signs the lease or the lease becomes effective, the lessee must receive a copy of or approve of the contract by which the goods were acquired or must receive a statement of terms (as warranties, disclaimers, and liquidated damages) relating to the contract or notification of where such information can be obtained. ground lease :  a lease of land usually for a long term in consideration of the payment of rent and with the agreement that the lessee build or improve a structure on the land —called also building lease mineral lease :  a lease granting the right to work a mine and extract the minerals or other valuable deposits from it under prescribed conditions (as of time, price, or royalties) —called also mining lease net lease :  a lease requiring the lessee to assume all operation expenses (as for maintenance, insurance, and taxes) in addition to the payment of rent operating lease :  a lease of property and especially equipment for a term which is shorter than the property's useful life and in which the lessor is responsible for certain expenses (as taxes) perpetual lease \pər-ˈpe-chu̇-wəl-\ :  a lease renewable forever at the lessee's option proprietary lease :  a lease used to convey to a member of a cooperative the exclusive possession of a residential unit true lease :  a lease that resembles a security agreement but retains the attributes of a lease b :  property and especially real property that is leased

  2. 2 in the civil law of Louisiana :  a contract by which a person provides labor or services for a price

Origin and Etymology of lease

Anglo-French les, from lesser to grant by lease, from Old French laisser to let go, from Latin laxare to loosen, from laxus slack


2

lease

verb

Legal Definition of lease

leased

leasing

  1. transitive verb
  2. 1 :  to grant by lease to another leases mopeds to tourists

  3. 2 :  to hold under a lease a company leasing a fleet of cars for its executives

  4. intransitive verb
  5. 1 :  to be under a lease or subject to a lease the vacation house leases for $500 a week

  6. 2 :  to grant property by a lease have leased to students in the past



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