Financial Leasing is an alternative financing technique in which the liquidity need is met by own resources or bank loans, by spending less liquidity and that the investment debt to be provided can be paid in the long term. In this respect, financial leasing is an important source of finance especially for medium-sized companies.

Financial Lease Agreement is a type of contract in which a leased property is transferred to the lessee in order to provide all kinds of economic benefits. All kinds of goods can be subject to the contract for the purpose of financing. However, intellectual and industrial rights, such as patents, cannot be subject to this contract, except for duplicate copies of computer software.

The ownership of the contractual property will belong to the lessor in accordance with the Law No. 6361 on Financial Leasing, Factoring and Financing Companies ("FFFK"). This is an important point that distinguishes financial leasing from normal rent. If the lessor does not own the property, it cannot be in the position of the lessor within the meaning of this law, and the contract cannot be considered as a financial lease contract that is subject to the provisions of the law. In addition, the parties can decide in the contract that at the end of the contract period, the tenant will have the right to purchase the property.

Financial lease price and payment terms are determined by the parties. Provided that it is clearly stated in the contract, even if the goods subject to the contract have not been produced or delivered to the lessee, the rental fees can be collected starting from the date of the contract. Unless otherwise stated in the contract, it is obligatory to deliver the goods subject to the contract to the tenant within two years from the contract date.

Each property subject to the Financial Leasing Agreement is annotated and registered in its own registry, and the non-registered goods are reported to the Association of Financial Leasing, Factoring and Financing Companies and registered there. After the registration or the ribbon, third parties' acquisitions in kind on financial leasing cannot be claimed against the lessor.

The tenant may assign the title of tenancy or the rights or obligations arising from the contract, provided that he receives written permission from the lessor. Due to this transfer, the tenant change in the financial lease agreement is registered or annotated. In the case of financial leasing transactions made within the scope of housing finance, the tenant may transfer the possession of the property subject to financial lease to another, provided that the leaseholder informs, and in other financial leasing transactions, there is a provision in the contract.

Unless otherwise provided for in the contract, the lessor cannot transfer the ownership of the property to a third party. If this authority is granted in the contract, the transfer can only be made to another lessor. The transferee must comply with the terms of the contract between the first tenant and the lessor.

According to the FFFK, it has become obligatory to insure the leased property and the issue of which party to insure the property should be determined in the contract.

The lessor may terminate the contract, even if this amount is not paid within the thirty-day period it gives to the tenant, who is default in paying the financial lease price. However, if it is agreed in the contract that the property will pass to the tenant at the end of the period, this period cannot be less than sixty days.

Each party to the contract may request the extension of the contract with existing or new terms, provided that it notifies at least three months before the end of the period. Extension of the contract depends on the agreement of the parties.