What is a Lessee?

Malcolm Tatum
Malcolm Tatum

The lessee is the party in a business transaction that contracts to make use of property or equipment for a specific amount of time. The transaction is governed by the terms and conditions documented in a lease agreement. In return for the privilege of using the equipment or property for the duration of the lease, the lessee agrees to pay the owner or lessor regular payments that are in accordance with the terms specified in the lease.

The term "lessee" is most commonly associated with the rental of a residential home or apartment.
The term "lessee" is most commonly associated with the rental of a residential home or apartment.

While the term can be used in any type of rental or lease situation, the idea of a lessee is usually associated with the long-term rental of property, such as a home or apartment. The terms of the lease normally provide the both the tenant and the owner of the property with specific rights, privileges, and responsibilities. As long as both parties honor their obligations, the lessee lessor relationship is usually a positive one.

Before signing any rental agreement, a potential lessee should read the provisions of the document thoroughly.
Before signing any rental agreement, a potential lessee should read the provisions of the document thoroughly.

With equipment rentals, the duration of the lease agreement may be shorter, even as little as a few days. While the equipment is in the control of the lessee, he or she is expected to exercise due diligence in the use of the equipment, while also taking reasonable measures to protect the equipment from harm. When the equipment is returned to the lessor, the equipment is often inspected. If it is found to be in good working order, the terms of the lease are considered fulfilled and the transaction is complete.

It is not unusual for any lease agreement to grant both lessor and lessee termination rights. For example, a tenant may be able to retire a lease early if an employer transfers him or her to another city. At the same time, the owner of the property may choose to terminate a lease early for non-compliance of the tenant with the terms and conditions of the lease. The non-compliance may involve factors like non-payment of rent or failure to honor prohibitions against having a pet or violating clauses having to do with excess noise. Usually, a lease agreement provides protection for both parties, making it possible for both the lessee and the lessor to end the business relationship if either party is failing to live up to his or her commitment.

Before signing any lease agreement, a potential lessee should read the provisions of the document thoroughly. If there are any clauses or sections he or she does not understand, it is important to seek clarification before entering into the lease. This will help prevent the possibility of misunderstandings regarding the responsibilities and privileges assumed by both parties for the duration of the agreement, and help keep the business relationship cordial.

Malcolm Tatum
Malcolm Tatum

After many years in the teleconferencing industry, Michael decided to embrace his passion for trivia, research, and writing by becoming a full-time freelance writer. Since then, he has contributed articles to a variety of print and online publications, including wiseGEEK, and his work has also appeared in poetry collections, devotional anthologies, and several newspapers. Malcolm’s other interests include collecting vinyl records, minor league baseball, and cycling.

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Discussion Comments


This was such a helpful article, thank you! I was never quite sure on the difference between the definition of lessor and lessee, but this sorted it right out for me.

Now I just have to impress my friends with my lessor vs. lessee knowledge!


My brother is a lawyer, and he always reminded me when I used to rent places to read the contract really, really well. The closer you read the contract, the more likely you are to get problems or misconceptions on the part of the lessor or lessee sorted out without tears.

If you do get into some legal wrangling with your lessor though, let me tell you, keep those landlord/tenant letters -- they can be invaluable evidence for you if the case goes to court.


Although all my relationships with landlords have been pretty positive, I can tell you, when you get into lessee vs lessor conflicts, things can get really nasty.

I've even heard of landlords turning off utilities to get a person to move out, or, on the contrary, the lessee deliberately damaging things in a way that won't show up until the lessor rents the place again. By that time they're long gone, and the lessor is stuck with the cost of refurbishing the apartment.

However, like the article says, it's a two-way street. For the most part, as long as you're respectful of the lessor and his requirements, he or she will be respectful of you and your needs too.

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