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A lease is a legal agreement that provides for the use of something -- typically real estate or equipment -- in exchange for payment.
Once a lease is signed, its terms, such as the rent, cannot be changed unless both parties agree. A lease is usually legally binding, which means you are held to its terms until it expires. If you break a lease, you could be held liable in court.
leasea legal contract under which the owner (the lessor) of an ASSET such as a building or piece of machinery grants to a person or company (the lessee) the right to use that asset for a specified period of time in return for the payment of an agreed rental. See LEASING, LEASEBACK.
leasea legal CONTRACT under which the owner of an ASSET (such as buildings and machinery) grants to someone else the right to use that asset for a specified period of time in return for periodic payments of RENT.
An oral or written agreement transferring the right to exclusive use and possession of property for some period of time.Some important lease concepts are
• The normal requirement that all contracts having to do with real estate must be in writing does not apply to contracts that are capable of performance in one year or less. In most states, an oral lease for less than one year is enforceable; an oral lease for a longer period is not.
• Atenant is not relieved of responsibility to pay rent if the premises are damaged, destroyed, or partially or totally unusable unless the lease allows it, or unless consumer protection laws applicable to residential leases allow it.
• If a tenant transfers the entire remaining term of a lease to someone else, that is an assign- ment. If a tenant transfers less than the remaining term, that is a sublease. Either way, the original tenant is still fully responsible for complying with all lease terms, even if the new one does not. In most states, a landlord may require its approval before assignment or subletting, but may not unreasonably withhold its approval.
• Atenant's interest under a lease may be insured, in addition to coverage for the contents. The interest may also be mortgaged, although that would be extremely unusual except in the case of valuable improvements built on leased land under a long-term lease.