Loan or leasing when buying a car in Germany. Which financing offers more advantages?

Are you looking for an ideal, low-cost way to finance your new vehicle? Two options are available: leasing or a personal loan. We will set out the advantages and disadvantages of both so that you can find the best solution for your needs.

Leasing contract

– Advantages of leasing:

• You can drive a car you could not afford without leasing.

• The financing cost is spread over the period of use. You avoid paying everything up front.

• The fixed interest rate lets you plan your budget clearly.

Disadvantages of leasing compared with a car loan:

• The car does not belong to you.

• There are many contractual restrictions.

• Overall costs are high. Leasing instalments are usually higher than the purchase price of the vehicle.

• You must keep the leasing contract until the end and cannot terminate it, otherwise you risk sanctions that will cost you dearly.

• The lessor can terminate the contract in the event of non-compliance or late payment, which means high costs for you.

• You are obliged to take out expensive comprehensive insurance.

• Extras such as winter tyres are not included in the financing and must be paid for yourself. If you return the vehicle, the extras are not reimbursed.

• Leasing cannot be deducted from tax.

• Most leasing contracts specify the brand garage where servicing must be carried out. Switching to a cheaper garage of your choice is therefore not possible.

• The car must be returned at the end of the contract. If the vehicle shows greater signs of use or the contractually agreed mileage has been exceeded, the difference to market value must be settled on return, which leads to further costs.

Garages often present the leasing contract as the only alternative to paying cash. That does not mean leasing is the best solution. A car loan, which you can obtain for example from Mutuo Gruppe.de, can be a very attractive alternative to leasing.

Car loan

Advantages of a car loan compared with leasing:

• The car belongs to you and you do not have to return it at the end of the contract.

• Low interest and no extra costs or processing fees.

• A free extra repayment is possible at any time.

• You can buy your vehicle from a dealer or privately.

• As a cash buyer you can achieve high discounts when purchasing the car.

• The interest can be deducted from tax.

• You can choose the vehicle insurance freely.

As you can see, a car loan has considerable advantages over leasing. With leasing you do not automatically become a proud car owner at the end of the contract. With a personal loan, by contrast, you are the owner of the vehicle immediately after purchase.

Our conclusion: car loans can often mean substantial savings for consumers and are also far more transparent on cost.

Calculate your car loan here.

Apply for a loan now →

Request a loan → Back to the blog