A one-pay lease and a cash purchase both mean no monthly bill, but they buy different things: paying cash buys the whole car, so you own it and carry its resale value, while a one-pay lease prepays the car's expected depreciation over the term plus a reduced rent charge and tax, so far less cash goes in and the lessor carries the resale risk.
Cash tends to fit if you keep a car for many years or drive a lot of miles; a one-pay tends to fit if you replace your car every two to three years and your miles stay inside the allowance.
| One-pay lease | Paying cash | |
|---|---|---|
| Due at signing | Every lease payment for the term, at a lower money factor, plus tax and fees | The full out-the-door price |
| What you pay for | The depreciation the lessor predicts over the term, plus a reduced rent charge | The whole car |
| Who owns the car | The leasing company | You, with a title in your name |
| Resale risk | The lessor's: if the car is worth less than the residual at the end, you can return it | Yours: what the car is worth when you sell or trade it is what you get back |
| Miles and wear | An allowance and a normal-wear standard, with charges at turn-in beyond them | No limit and no charge; both lower what the car is worth |
| Sales tax in Arizona and Nevada | On the lease payments, all collected at signing | On the full price, less any trade-in credit |
| Insurance | The lessor sets minimum coverage, often above your state's | Your choice, above your state's minimum |
| If the car is totaled | GAP-style coverage is often built into the lease; whether unused prepaid months come back depends on the contract | Insurance pays what the car is worth |
| The cash not in the car | Stays yours, to save or invest | None; it is all in the car |
| At the end | Return it, buy it at the residual, or lease again | Keep driving it, sell it, or trade it |
For a car you would replace in two to three years, often yes: you pay for the depreciation the lessor predicts plus a reduced rent charge, instead of absorbing the actual depreciation on a car you own, and far less cash goes into the car. For a car you will keep many years or drive many miles, paying cash usually costs less.
No. A one-pay is every lease payment made at signing, and it is used up over the term the same way monthly payments would be. At the end you return the car, buy it at the residual, or lease again.
Many captive leases include GAP-style coverage that clears the difference between the insurance payout and the lease payoff. Whether any unused prepaid amount comes back depends on the contract, so read its early termination and total loss section before you sign.
Both states tax a lease on its payments, so on a one-pay the tax on every payment is collected at signing (in Arizona, Department of Revenue ruling TPR 03-7). A cash purchase is taxed on the full price, less any trade-in credit.
Usually, at the residual value written into the contract, plus any purchase option fee and tax. Check the contract and the leasing company's rules before you count on it.