Credit or leasing? What to choose?

We’ve been writing a little bit about leasing a car recently. It was difficult to resist the similarity between leasing and lending, which is why in today’s article we would like to compare these two options and isolate the differences between them. This will help those interested to decide which one is better for them. Let’s focus on the company car.

To make a good decision about a company car, first of all you need to think about your own capabilities and expectations. Regardless of whether we take a loan or use the services of a leasing company, we must take into account certain factors and based on their importance and the benefits they bring, we will be able to make a decision. What should you focus on?

  • form of car use
  • speedy handling of all procedures
  • amount of own contribution required
  • length of repayment period
  • installment amount

The form of car use


Let’s start with the form of car use. As a company, we should consider whether we want to include the car in the company’s assets. If so, we should rather use the loan immediately. We are then the owners of the vehicle as opposed to leasing, where the car is owned by the leasing company and we are the only users.

In leasing, we cannot include cars in our own assets. For the entire period of using a car in leasing, we do not have the right to it, however, after the term of the contract, we often have the option of buying a car, deducting the amount of car wear.

So if someone cares about owning this car, but not necessarily immediately and not necessarily including it in the company’s belongings, he can safely think about the option of leasing and wait until the end of the contract.

Duration of procedures

If we want to get a company car as soon as possible, we will probably pay our attention to the length of all related procedures. Of course, the quickest would be to bring cash and go to a car dealership, however, without this option, we can count on credit or leasing.

What do these procedures look like? In the case of credit, they are definitely more complicated. The required documents relate, among others, to the Social Insurance Institution, the Tax Office and a thorough examination of the company’s creditworthiness.

It takes time and activities of the right units for everything. In the case of leasing, the procedures are much simpler, because it is much easier to obtain creditworthiness.

Own contribution

In each case, it is required to provide your own money amount, i.e. own contribution. It cannot be clearly determined what is more profitable in this respect – credit or leasing, because there are really many offers.

Statistically, leasing companies require an amount of own contribution in the range of 0-45%, while banks 0-90%. So it turns out that in the case of credit, the own contribution is even 2 times higher than in leasing, but in practice you can find the opposite situation. You have to search.

Vehicle repayment time

Vehicle repayment time

The repayment time of the vehicle is also important, because once it is repaid, you can feel its rightful owner. Monthly installments remind us that we are still indebted to someone, be it a leasing company or banking institution, and only when the repayment period ends will we be free of obligations.

How long can it take? In the case of leasing, this period may be from 24 to 60 months, while in the case of loans from 1 to 120 months. After paying off the loan, the car remains our property. After the leasing contract ends, you can apply to buy a used car.

Allan Cayetano

Back to top