Full-payout lease

Full-payout lease

Capital Lease

A long-term lease in which the lessee must record the leased item as an asset on his/her balance sheet and record the present value of the lease payments as debt. Additionally, the lessor must record the lease as a sale on his/her own balance sheet. A capital lease may last for several years and is not callable. It is treated as a sale for tax purposes. It is also called a financial lease.
References in periodicals archive ?
This transaction will allow PLM International, which has heretofore specialized in the management of transportation equipment on mid-term operating leases, to expand its operations by gaining origination capability in the full-payout lease market, as well as remarketing and portfolio management capabilities for a broader range of leased assets.
These will include true leases with fair market value residual, full-payout leases, tax-exempt municipal programs, and options for seasonally adjusted "flex" payments.