What are the disadvantages of private leasing?

Driving a new car with private lease. It sounds great and carefree, but it's not cheap. You no longer have maintenance costs, depreciation, taxes and insurance premiums, but that doesn't mean you are cheap with private lease. In fact, there are some major drawbacks as well.

Buying a new car requires a large sum of money all at once. After the purchase, you also have to reserve for the next car right away. This is called depreciation. As a car owner, you also pay an amount to the tax authorities and to an insurance company. With a new car you have few maintenance costs, but you will incur costs. Leasing companies say they have the solution. One flat fee in the form of a private lease. It is an option, but keep in mind the drawbacks.

They are often long-term contracts

With private leasing, you can choose between different terms. These are often contracts of one to four years. Circumstances may make it necessary to break open a lease contract mid-term. This is the case, for example, when there is a drop in income due to disability or unemployment. What the consequences are of breaking open the contract varies from provider to provider. It is often not clear from the terms and conditions. When entering into a lease contract, you must assume that you must also serve out the contract. This is because the penalty amounts can be hefty.

Private lease and the mortgage

Did you know that private leasing can make buying a house impossible? Because when you apply for a mortgage, your fixed expenses are taken into account. With private leasing, you temporarily have high monthly expenses. Here, it does not matter that these are temporary charges. It may be necessary to buy out the private lease agreement all at once in order to make a mortgage possible.