What are the disadvantages of private leasing?

The rates you see in advertisements often seem low. However, these are starting prices. In such a contract, for example, you may only drive 1,000 kilometers per month. If you drive more, your monthly rate increases or you pay a surcharge of, for example, €0.10 per kilometer. In addition, you often pay extra if you have few damage-free years. Thus, private lease seems advantageous at first, but can end up being a lot more expensive.

Leases usually last three or four years. That seems manageable, but the total cost is high. At €399 per month, you pay more than €19,000 in four years. These charges come on top of your other fixed expenses. If your situation changes, such as unemployment, disability or divorce, the monthly amount can suddenly become too heavy. You usually can't stop the contract just like that. If you break it up prematurely, the costs can add up significantly, because leasing companies often charge high penalties.

In case of damage, you often pay part of the cost yourself, called the deductible. How high this amount is varies from provider to provider. Sometimes you can buy off the deductible for a higher monthly amount. That seems attractive, but it does result in extra costs. So it is important to read the terms and conditions carefully.

If you want to buy a house, private leasing can be a problem. Banks always look at your fixed expenses when determining your maximum mortgage. The monthly amount of your lease counts in full, even if the contract is temporary. Sometimes a mortgage can only go through if you buy off the lease contract at once, which can cost thousands of dollars.

A major disadvantage of private leasing is that you never become the owner of the car. At the end of the contract, you turn the car back in. In contrast, if you buy a car yourself, it remains yours and you can sell it later. When you sell it, you often still get a portion of your investment back, whereas with leasing you accumulate nothing.