Car loan, leasing or cash — which works out best?
The three ways to finance a car, and when each one makes sense.
Paying cash
The cheapest option if you have the money and cannot put it to better use elsewhere. Keep a buffer for unexpected repairs. Paying cash also puts you in a stronger position with a dealer.
A car loan
Compare the APR, not just the interest rate. A loan secured on the car is usually cheaper than an unsecured consumer loan. The larger the deposit (20% or more is good), the lower the rate. Avoid a loan that runs longer than you expect to keep the car.
Private leasing
A fixed monthly payment and no residual-value risk, but you own nothing at the end, and there are mileage limits and condition requirements when you hand the car back. It makes sense if you change car every two or three years and want predictable costs.
A used car with outstanding finance
If you buy privately, the seller's loan must be cleared before the car is yours. Check the Danish vehicle charges register (tinglysning.dk). You can agree to pay the seller's bank directly against a receipt for settlement.
What we would do
Work out the total cost over the time you will own the car: purchase price + interest and payments + tax + insurance + servicing, minus what you expect to sell it for. That figure, not the monthly payment, shows which option is cheapest.