Financial leasing: what is it? The finance lease contract
Financial leasing is a transaction that allows the grantor to provide investments to the user by means of a contract that establishes which assets have been purchased and how and in how much time they are used. It is in fact the purchase of goods and services by a person who makes them available to another according to the parameters established initially and signed by both parties.
The user can choose to buy the services and tools that have been provided by the grantor by paying a sum that allows them to be redeemed and become the owner. The redemption of the financial lease proves to be a particularly useful tool since it keeps open the possibility of acquiring ownership of the goods and services after a period of use. In this way, the user can prove the effectiveness of what he has requested and, by using it, can accumulate the amount of money necessary to get it.
The main operations that make up the plan of a financial leasing contract are essentially three
The maxi fee (when with the first payment at the signing of the contract a higher installment is paid than the periodic fee), the periodic fee (when it is decided to pay the installments monthly, quarterly or with other periodicities to be indicated in the stipulation contract) and the redemption (consisting of the necessary sum that the user needs to be able to purchase the asset at the expiry of the contract).
A financial lease has very specific characteristics that differentiate it from other types of financial contracts
First of all, a leasing contract must have a duration that takes into consideration the technical characteristics of the good in question and how its use may vary over time, ie the duration of the contract must be related to the technical-economic duration of the asset. The second characteristic relates to the structure of the financial plan, which has many features in common with a loan transaction, the third one relates instead to the possibility of redemption whose value must be lower than the market value of the asset at the time when the leasing contract.
In fact, it is assumed that a part of the purchase value has been paid through the payment of the installments that make up the financial leasing payment plan. Usually, the value of the asset is estimated at between 1% and 40% of the original cost of the asset, since in the estimate of the value the use that is made of it and for how long must be considered, following the same logic underlying the purchase of second-hand goods.
The rules governing financial leasing refer to articles 1523 and 1526 of the Civil Code, where the characteristics of this financial transaction are explained and the legislative parameters are established within which to exercise rights and duties both by the grantor and by the user.
For more information and to enter into a leasing contract, you can contact specific agencies or the branches of banks that deal with financial leasing.