In QC, what should I know about leasing vs financing for car loans?

In Quebec, the decision between leasing and financing a car loan carries significant financial distinctions. Leasing typically results in lower monthly payments, as you are essentially paying for the vehicle's depreciation over the lease term, plus interest and applicable QST/GST on each payment. This option is ideal for those who prefer driving a new vehicle every few years, benefiting from continuous warranty coverage, but it comes with strict mileage limitations and potential charges for excessive wear and tear at the lease's conclusion. Considering the 2025 market, where interest rates may still be elevated, lower lease payments can be appealing for managing immediate cash flow, though residual values will influence end-of-lease buyout costs.

Financing, on the other hand, means you are purchasing the vehicle outright. While monthly payments are generally higher because you're amortizing the full purchase price (with QST/GST applied upfront on the total amount), you build equity with every payment, ultimately owning the asset. This provides complete freedom from mileage restrictions and wear-and-tear penalties, along with the ability to customize or sell the vehicle at your discretion. In a 2025 landscape, where vehicle values and interest rates can fluctuate, owning the vehicle outright offers long-term stability and avoids the structured constraints of a lease. The optimal choice for a Quebec consumer hinges on personal driving habits, financial priorities - whether you prioritize lower short-term costs and frequent vehicle upgrades (leasing) or long-term ownership, equity building, and unrestricted use (financing).