Car Loan vs Leasing Calculator
Financing a car in Denmark comes with unique considerations due to the high registration tax (registreringsafgift). Whether you choose a traditional car loan or a leasing agreement significantly impacts your total cost. This calculator lets you input the specific terms of both options and directly compare the total outlay over the financing period.
Understanding Car Loans in Denmark
With a car loan, you pay a down payment (typically 20%) and then monthly installments with interest over the loan period. Typical car loan interest rates in Denmark range from 4-8% depending on the lender and your credit profile. For example, borrowing 300,000 kr at 5% over 5 years results in a monthly payment of approximately 5,662 kr. The advantage is ownership: once the loan is paid, you have a valuable asset you can sell or continue using without monthly payments.
Understanding Car Leasing
Leasing means you pay a first-time payment and a fixed monthly amount for a set period, typically 24-48 months. A typical leasing payment for a mid-range car in Denmark is 3,000-5,000 kr/month. Leasing is advantageous if you drive less than 15,000-20,000 km per year, want predictable costs, and do not want to worry about depreciation.
Choosing Between Leasing and a Loan
A rule of thumb says that if the monthly leasing payment (including the first-time payment spread over the period) amounts to less than 50% of the car's new price over 3 years, leasing may be beneficial. Choose a car loan if you plan to keep the car for many years (5+), drive many kilometres, or want to own the car outright. Note that the electric car leasing market is currently attractive, as it removes the risk of significant depreciation on new technologies. Always compare the total cost over 3 years, as down payments and service costs vary greatly.