The Lease Agreement Explained
Leasing has a vocabulary all its own. For starters, rather than a buyer you are the “lessee,” and the company (FMCC) you lease from is the “lessor.” A dealer can assign the lease agreement to a lender or other party.
A lease is an agreement to use a vehicle for an agreed number of months. You do not own a leased vehicle and are required to return the vehicle when the lease ends unless you exercise a purchase option, if applicable.
The intent of this article is to provide a review of key elements. However, be sure to read the entire agreement, ask questions, and understand your obligation before driving off the dealer lot.
Note: your lease agreement may look different depending on the lessor and state. Unused lines should be filled in with “NA” or “0.”
OK, let’s have a look around a typical lease agreement.
1. The top of the agreement has an area for your (lessee) name, full address, and that of the dealer (lessor). This information repeats on other documentation and is used by lessor to among other things send billing statements and communications. Verifying the information is a simple, important task.