Glossary

  • ASSET-BASED FINANCING
The financing of equipment and vehicles and of related items or services, primarily by way of lease, but also by secured loan or conditional sales contract. (CFLA)

 

  • LEASE
A contract in which one party conveys the use of an asset to another party for a specific period of time at a predetermined rate.  (U.S. Equipment Leasing Association)

 

  • LESSEE
The user of the equipment being leased. (U.S. Equipment Leasing Association)

 

  • LESSOR
The party who owns the leased asset.

 

  • RESIDUAL VALUE
The value of an asset at the conclusion of a lease. (U.S. Equipment Leasing Association)

 

  • SALE LEASEBACK
An arrangement whereby equipment is purchased by a lessor from the company owning and using it. The lessor then becomes the owner and leases it back to the original owner, who continues to use the equipment. (U.S. Equipment Leasing Association)
 
  • PURCHASE OPTION
A provision by which a lessee has the right to purchase the equipment at the end of the lease. The purchase option may be stated at a specified amount or at fair market value. (U.S. Equipment Leasing Association)

 

  • SALE LEASEBACK
An arrangement whereby equipment is purchased by a lessor from the company owning and using it. The lessor then becomes the owner and leases it back to the original owner, who continues to use the equipment. (U.S. Equipment Leasing Association)