BLM00610 - Introduction: Commercial substance and structure: Finance leases: Finance lease rentals

Typically a finance lease is structured like a repayment mortgage. That is, in substance, the rentals in the early years are mostly ‘interest’ while towards the end they are mostly loan’ repayment. The following simple example shows a typical profile for a ten year lease.

Diagram of a typical profile for a ten year lease

See BLM00630 for a brief description of alternative profiles.