A lease that does not contain a purchase or renewal option, thereby requiring the lessee to return the equipment to the lessor at the end of the initial lease term. Also refers to a vehicle lease in which the lessor absorbs the entire risk of the residual.
(Walk-Away Lease or Net Lease) - A type of lease agreement in which the lessor, not the Lessee assumes financial responsibility for the difference between depreciated value and the actual cash value of the lease vehicle at lease end. Lessee is responsible for excess wear and tear. A fixed term.
Lessor assumes financial responsibility for any difference between depreciated value and actual cash value. Also called net lease that establishes a residual value for the leased auto and fee amounts due at the end of the lease term.