It’s the first question many olim ask: “Am I really buying the car, or am I renting it?” The answer changes the name on the registration certificate, what you can do with the car, and whether you can use the olim benefit.
A car loan: you own the car
With a loan (halva’a), you buy the car and a bank or a credit company lends you the money. The car is registered in your name. The lender usually registers a lien on the car: you cannot sell it without paying off what you still owe.
In Israel, many car loans are balloon loans: monthly payments are lower because part of the price is paid in one go at the end. The details are in our step-by-step article on financing.
The three kinds of leasing
In Israel, the word “leasing” covers very different contracts:
- Operating lease (lising tif’uli): a rental over several years, often 3, sometimes with maintenance, insurance and taxes included. At the end, you hand the car back.
- Finance lease (lising mimuni): the leasing company finances the car; at the end, you can become the owner for a payment agreed at signing.
- Private leasing: financing for a new car from a leasing company, without the services of an operating lease.
Always read the contract: whose name the car is registered in, what happens if you want to stop early, how many kilometres are included, and what the purchase option costs.
Loan or lease: what changes for you
| Loan | Operating lease | Finance lease | |
|---|---|---|---|
| Name on the registration certificate | Yours | The company’s | Depends on the contract |
| Owner at the end | Yes | No, you hand the car back | Yes, if you take up the option |
| Selling before the end | Yes, by paying off the loan | No, early exit depends on the contract | Depends on the contract |
| Mileage limit | No | Often | Depends on the contract |
| Olim benefit | Possible | In principle, no (car not in your name) | Possible if the car is in your name |
The olim benefit with a lease
The olim tax benefit applies to a car imported or bought in the oleh’s name. A lease where the car stays in the leasing company’s name therefore doesn’t meet this condition. Financing where the car is registered in the oleh’s name, with a lien, does: we have already done it for clients.
The benefit rules stay the same: only the oleh and their spouse may drive the car, and it cannot be freely resold for 4 years.
Comparing two offers properly
The monthly payment alone isn’t enough to compare offers. For each one, ask for the total price of the car, the down payment, the term, the final payment, and the real cost of the loan (interest and fees), which Israel’s Fair Credit Law requires the contract to state. The same law also caps the real cost of a shekel loan at the Bank of Israel rate plus 15 percentage points.
Which option suits an oleh?
If you want to keep the car for a long time, sell it whenever you like and use the olim benefit, a loan with the car in your name is the simplest choice. An operating lease suits someone who wants to change car every 3 years without dealing with maintenance, and who accepts never owning it.
Jaecoo 7from 2,028 ₪/month*Olim benefit possible
Chery Tiggo 4 Profrom 1,373 ₪/month*Olim benefit possible
Kia Picantofrom 1,192 ₪/month*Olim benefit possible* Example loan at 4.13% with no down payment, subject to approval. Catalogue price as of 28 October 2026.
Frequently asked questions
Can you switch from leasing to buying?
With a finance lease, yes: the purchase option is set out in the contract, with its price. With an operating lease, you have to negotiate with the leasing company.
Who pays for insurance during a loan?
You do. The lender usually requires comprehensive insurance until the loan is repaid.
Can you repay a car loan early?
Usually yes, with early repayment fees set out in the contract. Ask how much they are before signing.
Sources: Fair Credit Law (sections 2 and 3, and the cap on the cost of credit); Bank of Israel, decision of 21 October 2026 (3.25% rate); Tax Authority, tax guide for new immigrants (30 July 2026); iCar’s car finance glossary (definitions of lease types). Olim benefit with financing: John Auto’s experience, with the car in the oleh’s name.