& Purchasing Terms & Definitions
Lessee: The person(s) who enters the lease;
the person(s) responsible for payment of the lease.
Lessor: An entity that leased personal
property under a lease; in a traditional dealer-originated lease, the dealer is
the original lessor and the lease is assigned to a subsequent lessor, such as a
captive finance company or bank.
Fee: A fixed
dollar amount that is charged by the lessor that offsets some of the costs
related to setting up a lease account.
End Lease: A lease
in which the lessor is responsible for the difference between the residual
value and the realized value provided that the lessee retains the vehicle until
the date of maturity. The lessee may still be responsible for excess mileage,
wear and use.
A fee charged by the
lessor at time of termination to process the return of the vehicle.
which exceeds the standards for normal use listed on the lease agreement, for
which a lessee may be charges when the vehicle is returned.
Wear and Use: Damage
that exceeds the standards for normal use listed on the lease agreement, for
which a lessee may be charged when the vehicle is returned.
estimated value of the vehicle at the end of the lease; this value is used to
determine a portion of the monthly payment.
paid up-front by a borrower to reduce the amount financed in a lease or loan.
While a large down payment can reduce your monthly payments, it also likely
will be forfeited in the event of a totaled or stolen vehicle.
Percentage Rate (APR): Also
called a finance rate, this is the interest rate on a loan; a percentage of the
amount borrowed that a lender charges annually for the use of its money.