Is leasing-to-own a car better than leasing a car in the UAE?
Leasing a car offers lower monthly payments compared to buying or leasing-to-own
Dubai: Whether leasing-to-own is better than leasing a car depends on your needs and financial situation. Here’s a comparison to help you decide:
Perk vs Risk: Lease-to-own a car
The primary advantage of leasing-to-own is the eventual ownership of the car. At the end of the lease, you have the option to buy the vehicle, allowing you to continue driving the same car without starting over with a new lease. This is ideal if you like the car and want to build equity over time.
The key risk of leasing-to-own is that you may end up paying more than the car is worth if you decide to purchase it. Lease-to-own agreements often have higher monthly payments than standard leases, and the buyout price at the end may exceed the car’s market value, especially if it depreciates more quickly than anticipated.
Perk vs Risk: Leasing a car
Leasing a car offers lower monthly payments compared to buying or leasing-to-own, which can be more manageable for those who prefer driving newer models without the long-term financial commitment. It also allows for more flexibility to switch to a new car after the lease term ends.
A significant downside of leasing is that you don’t own the vehicle. Once the lease term is over, you have to return the car and won’t build any equity. This can feel like a continuous cycle of payments with no long-term ownership benefit.
Verdict? Leasing-to-own is better if you want to eventually own the car and plan on keeping it long-term. Traditional leasing comes with more flexibility and lower upfront costs but no long-term asset, meaning it's better if you like driving a new car every few years and don’t want the commitment of ownership.