The essential elements of leasing are the following:
Parties to the Contact
There are essentially two parties to a contract of lease financing, namely the owner and the user, called the lessor and the lessee, respectively. Lessors as well as lessees may be individuals, partnerships, joint stock companies, corporations or financial institutions. Sometimes there may be joint lessors or joint lessees, particularly where the properties or the amount of finance involved is enormous. Besides, there may be lease broker who acts as an intermediary in arranging these deals. Merchant banking divisions of certain foreign banks in India substances of some Indian banks and even some private merchant bankers are acting as lease bankers. They charge a certain percentage of fees for their services, ranging between 0.50 to. 1 percent, Besides, a lease contract may involve a lease financier, who refinances the lessor, either by providing term loans or by subscribing to equity or lending under a specific refinance scheme.