Generally speaking, the credit score you need to lease a car has to be classified as good, which usually means a FICO credit score of 660 and up. However, leasing companies have different cut-off points, and you could still be turned down for a lease with a score in that range. In addition to having good credit, there are other things you can do to improve your odds of qualifying for a lease, and we’re here to tell you what they are.
3 Ways to Increase Your Car Lease Approval Odds
There’s no getting around it: when you have bad credit, you’re going to find it difficult to qualify for a lease. While some major car brands such as Kia have lease programs for some borrowers struggling with credit issues, even if you qualify, you may want a different type of vehicle.
If this is the case and you’re worried your credit is in the way of a lease deal, consider trying these three things to help improve your approval odds:
- Make a large capitalized cost reduction – A capitalized cost reduction on a lease is equivalent to a down payment on a loan. Cap cost reductions lower your monthly payment, but instead of reducing the overall cost, you're essentially pre-paying the lease because interest charges are built in at the start. Although a cap cost reduction isn’t usually required, some lessors may ask you to make one if you don’t meet their credit requirements. Just like financing, the more money you put down, the better the odds are of you getting approved.
- Have a security deposit – Depending on who you decide to lease with, you may only qualify for the lowest lease tier and be asked to make one or more security deposits in order to get approved. Not to be confused with a cap cost reduction, a security deposit is something you get back at the end of the lease provided there’s no excess wear and tear or damage to the vehicle.
- Consider a cosigner – You may be able to have a cosigner sign the lease with you. If the cosigner has good credit, it could give your application the needed boost. A cosigner can sometimes be the deciding factor between approval and denial with a car lease.
When Bad Credit Leasing Isn’t an Option, Consider Financing
Leasing is attractive because of the potential for a lower monthly payment, and the ability to drive a brand new car every few years. Unfortunately, those dealing with credit issues are more likely to be turned down for a lease.
If this is the case, it may make sense to finance a vehicle for now, and consider leasing in the future. When you take out a bad credit auto loan, you give yourself the chance to rebuild your credit.
You may not be driving the car of your dreams, but your credit score should improve down the road as long as you make each payment on time, while staying on top of your other bills. This can help you qualify to lease in the future or get you behind the wheel of the vehicle you truly want the next time you apply for an auto loan.
Need Help Getting Started?
If you’re unsure about leasing right now because of your credit situation and are looking to finance in the meantime, let us find you a dealer that can help you get started on the car buying journey.
At The Car Connection, we connect consumers to local dealerships that know how to assist people in unique credit situations. All you have to do is complete our auto loan request form, and we’ll get right to work matching you with a dealer near you.