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Leasing a Car with Bad Credit – Is It Possible?

Leasing a Car with Bad Credit – Is It Possible? Leave a comment
leasing a car with bad credit

If you’re shopping around for a new car, but don’t have that great of credit, you may feel like it is going to be impossible to get behind the wheel of a new ride. However, there are more and more options available every day for those of you with not so stellar credit scores! If you have bad credit, as well as are in the market for a vehicle, it isn’t impossible leasing a car with bad credit!

What is “Bad” Credit?

Because leasing a car is a major financial responsibility, you need to have a credit check done before dealerships will allow you to lease a vehicle. Whether you get a lease is determined by your credit history, as well as your personal financial situation. But what exactly is considered bad credit?

Here is a detailed credit score scale:

  • Bad Credit: 300 – 499
  • Poor Credit: 500 – 579
  • Low Credit: 580 – 619
  • Average Credit: 620 – 679
  • Good Credit: 680 – 699
  • Excellent Credit: 700 – 850

If you are unaware of your credit score, then there are tons of available resources for you both online and with your own financial institutions. Check out some great finance podcasts, financial literature, or even online classes to find ways to get your credit score from bad to excellent!

Options Available for Leasing a Car with Bad Credit

Despite having bad credit, if you need a car, you need a car! There ARE options available to you. However, some options may require you paying off more than you initially planned. Here are some ways you can lease a car, even with bad credit.

Finance Options

Overall, the finance options for people with bad credit aren’t too terrible. It will simply cost you more money in the long run. Leasing a car means figuring out your annual percentage rate, as well as determining your rent charge, or the cost of financing a vehicle. All in all, if you have a lower credit score, you will have a higher APR and higher finance charges.

finance options

If you can’t find a place to lease a car to you, then you can look into dealerships that provide pay-here options. However, this should only be done if you absolutely NEED a car, and you can’t go anywhere else. Because although you may get approved, you may have to pay weekly, have higher costs on repairs, or even pay higher rent charges!

Large Down Payment

An excellent option for leasing a car with bad credit is to offer up a larger down payment. A significant down payment can not only lower monthly payments as well as interest over time, but it can also improve the probability of you being approved for a lease agreement!

Sometimes you may have a bad credit score simply because you don’t have a good credit history, that doesn’t mean you don’t have the money saved up. For instance, your credit score can go down simply because you’ve already paid everything off! Not only are dealerships aware of these types of situations, but sometimes allow for larger down payments because of them!

Find a Co-Signer for Leasing a Car with Bad Credit

Another excellent option for finding financing for a car lease is to find someone who is willing to co-sign your lease agreement with you. However, this means that this individual will be financially responsible for your lease payments if you are unable to make the payment on time. If you have someone you trust, and someone who trusts you to make payments responsibly, then this can be a solid option.

Take Over Another Lease

Lease swapping is an extremely common practice. Not only can you be approved to take over someone else’s lease, but you will only be responsible for the remaining payments on the initial agreement. However, lease swapping means you will have to have similar credit to the person who originally signed the lease. Overall, it’s a straightforward way to lease a car with bad credit, you simply have to find someone looking to get out of a lease!

taking over leasing a car with bad credit

Special Financing

Dealerships with special financing offices are excellent options for people with bad credit. If you’re just now looking into planning tops to success, and have a bad credit history, then these special financing locations will help you to lease a car. Not only that, but it can help you get back on the right track with your credit score! These auto loans generally have higher interest rates, as well as higher monthly payments.

Leasing a Car with Bad Credit Isn’t Impossible!

All in all, if you’re looking to lease a car, and your credit score isn’t so great, there ARE options available for you! Leasing a car with bad credit can happen, but it typically means you may have to pay higher interest rates, or even higher monthly payments. If you need a car now, it is possible, even with bad credit!

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