Leveraged lease

• A lease under which the lessor acts as an equity participant, supplying only about 20 percent of the cost of the asset, while a lender supplies the balance.

• The lessor provides only a minor portion of the cost of the leased equipment, borrowing the rest from another lender.

• A lease arrangement under which the lessor borrows a large proportion of the funds needed to purchase the asset and grants the lender a lien on the assets and a pledge of the lease payments to secure the borrowing.