I don’t understand why there is an interest rate quoted on car leases. How is leasing something different than renting something? If I get an apartment I just pay rent. So how does interest come into play.
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When you take out a loan there is a both a risk to the person making the loan that they won’t get their money back and an incentive to make a business of it.
Loan companies (banks, car loan etc) aren’t charities, they want/need profit to be a business.
The interest is the cost you pay for the ‘benefit’ of being able to get something without having the money to pay it up front. It’s also an incentive to continue to repay the loan as the interest costs less as the borrowed amount is paid back.
Compared to renting a home: 1. You don’t keep the home, 2. You do pay extra, generally rent costs more than the actual ‘cost’ of the property (eg owners mortgage on that place plus upkeep). But mostly it’s not a loan because you are effectively paying for use of, vs for ownership of.
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