IS CAR LEASING POSSIBLE WITH A BAD CREDIT?

Car leasing with a bad credit score is possible if you prepare for it. Learn the ways to improve your credit history and find out the alternatives.

The only point everybody dislikes about life is that your past activities can affect your current conditions so much even in some really unexpected moments.

You find the company to lease a car but your payments of the last few years make the credit history not so favorable. It’s a big deal to change the past and to make sure that everything will work your way.

However, the point is that you can be careful enough, show your story as the appropriate one and earn approvals on your needs now. Grand Prix Motors is here for the explanation!

What is a lease?

Leasing a vehicle is an agreement for driving the new car with the cost built on car depreciation.

It is getting more popular than buying an auto because this type of car temporary ownership gives you an opportunity to drive a new model vehicle and save money.

In general, the system consists of 3 aspects you should know:

Where is the connection between a car lease and a credit history?

Leasing a car and your credit score have a strong correlation. In case you want to lease a particular car, you have to show an appropriate credit score which serves as evidence that you can maintain monthly payments.

And, vice versa, leasing a car can help you build the credit score really well if you have good credit habits. Credit plays a major role in any loan application procedure. 

You cannot get a car lease without a credit history, because when you’re getting a car lease, you always go through a credit score check. There are 2 types of inquiries on your credit history: A hard inquiry and a soft inquiry. In a hard inquiry, the bank makes a request on your credit history and diligently checks everything you have there. Whereas in a soft inquiry, the bank makes a request on your credit history and also does an overview to ensure you’re the right fit.

In an exclusive interview with Grand Prix Motors CEO Lenny Komsky, you will find out how a credit check works for the car lease.

How does it work?

Your credit history shows how reliable you are for the company to cooperate with you. The customers often worry about the reputation and authority of the lease provider.

The same happens when the company carefully checks the client’s background and ability to make on-time payments and cooperate for a long time. If you enter the market to lease a new auto, improve your credit scores to make sure the company will have no doubts about your further cooperation.

Building your credit history is another process that requires enough attention and a responsible attitude. In this case, leasing a car can help you to do it well by adding an installment account.

The leasing company will report your regular payments every month to the credit reporting agencies. It depends on you, if you do the payments in a timely manner, it will work on you and boost your credit score.

What should you do before leasing a vehicle?

You can take care of your credit history before leasing to make sure you will get the best lease deal. Consult your personal assistant to find out the possible deals according to your credit score!

How to prepare your credit score for a car lease?

• Lower the balances on credit cards to less than 30 percent of your credit limit
• Make payments on time to prove your responsibility 
• Check carefully your credit reports to be sure there are no mistakes
• Keep credit accounts open till the moment you really need to close them

Can you lease a car with a poor credit score?

First, you should understand that the exact credit score can differ depending on the dealership. According to NerdWallet, a score between 680 and 739 is considered to be the ideal one among leasing companies.

Although the lease offers are typically provided for the customers whose credit score starts from 620 as well. 

What can you do if you have a bad credit score?

Let’s start with some ways the process can occur:

• Leasing inability which sometimes happens if the company makes such a decision. 
• Signing with higher payment and some extra dollars to your monthly payment if your credit score is below 680
• Used car loan which is available for people with low credit score

Fortunately, there are various alternatives provided to make car leasing possible for everybody!

Lease transfers

It is a special type of leasing which gives an opportunity for another person to lease a vehicle for you. You will be able to ask your friend or relative with a better credit score to accompany you to the leasing company and to make the agreement.

Also sometimes leaseholders are looking for somebody to take over their lease, so you will be able to get in touch with them and to get your car!

Personal finance department

The financing departments usually exist in the leasing company to keep cooperation with people who have a low credit score. They can manage your situation according to your ability to pay.

Large down-payment

If you show your responsible attitude and ability to pay, it can be the best evidence you will be a reliable customer. The initial payment is not commonly required but thus you can prove that cooperation with you won’t be risky.

Co-signing

You may consider co-signing the contract with your close person. It will be the question of shared responsibility.

Co-signing means the person is ready to make some payments if you aren’t able. It is sometimes a good idea if you are not approved to fulfill the arrangements on your own.

Leasing a vehicle is an effortless process when you are prepared for this or trust the process to the professionals. If you have any questions and issues to discuss, contact your GPM  personal expert now!

Remember we always have the solutions for everybody who really wants to drive the best cars for the best prices.

#enjoy your freedom with Grand Prix Motors!

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