An installment lease features fixed monthly payments and the option to purchase at a fixed price after the lease term. These payments are determined by taking the total rent due for the entire lease and dividing it equally across the length of the lease. Often there is no residual amount due at the end of the lease and ownership will be transferred to the lessee at the end of the lease term.

The monthly payments are not rent for the commercial vehicle, but instead are installments.

The lessee takes on the depreciation benefits from the lease, while Trans Lease is the titled owner throughout the life of the contract. The lease payments can often be considered operating expenses.

Benefits of InstallmentĀ Leases for Commercial Vehicles

  • Fixed monthly payments
  • Option to purchase at the end of term
  • Often have no residual due at the end of term
  • Tax advantages for the lessee
  • Lessor retains ownership

Frequently Asked Questions

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An installment lease is a financing agreement where the lessee pays fixed monthly payments, which are the installments, in exchange for use of an asset. The lessor retains ownership, but the lessee may purchase the asset at the end of the term, if that is not already an agreed upon arrangement. Installment leases are popular options for commercial vehicles and equipment.

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