Leasing a car is a form of financing where you pay each month to use a car, akin to renting an apartment. Because of this, when your lease is up, you have to return the vehicle. Leasing can have lower monthly costs and allow you to have a new vehicle every few years, but leasing has its drawbacks, including mileage limits. At the end of the lease, some contracts will give you the option to buy the car, which you can do with a lease buyout loan. Buying a car has higher costs, typically requiring a down payment and higher monthly payments. But, at the end of it all, you own the title to the vehicle and will have no car payments after you’ve repaid your loan.