What Is a Bad Credit Score for Car Leasing the Guide
When you lease a car, you’re essentially taking out a loan with a finance company. You’ll then pay back that loan monthly, which pays for your car.
When lending money, finance companies need to be confident that you’ll be able to pay them back. They assess this confidence in the form of a credit score; so for a finance company to agree to your lease, you’ll need a good score.
This guide will talk about how a bad credit score can affect your eligibility to lease a car.
Is It Possible To Lease A Car With A Bad Credit Score?
Although possible, it is unlikely that if you have poor credit you’ll be accepted for a lease.
Finance companies have scorecards that will assess whether you should be given credit. These scorecards are based on credit-worthiness, affordability and a range of other factors.
Over at Motorama, we use a panel of different funders, so if a person’s credit score is poor then that will greatly reduce the number of funders that will potentially approve your application (if any).
What Sort Of Deal Will I Get If My Credit Is Bad?
The monthly price shown on your quote will be set and subject to passing a credit check. A funder will not increase the monthly price based on your credit score. So in order to get a deal in the first place you will need to have acceptable credit.
The likelihood of being approved on the best & exclusive deals will be higher for those with a higher credit score. Those with a “poor” score may not be eligible for those offers.
The only thing a finance company may do is ask for a higher initial rental or a shorter lease term than applied for if your credit searches return a “borderline” decision.
What Is A Bad Credit Score?
A poor credit score is a combination of many factors – payment history, traceability, and other risk factors.
Despite the misleading name, there is actually no set number or score that works universally. This is because all of the finance companies have their own scorecards.
At the end of the day, if you can show finance companies that you can and will pay them back, they are much more likely to give you a car lease.
What Can I Do If I Am Worried About Passing A Credit Check?
There are a few things you can do if you’re worried that you won’t get credit to lease a car. In the first instance, you could check whether you’re likely to get credit. At Motorama, we’ve got a helpful tool called the eligibility checker which can be found here. This will give you a brief overview of your eligibility and allow you to get an idea of whether or not you’ll be approved.
Alongside the Eligibility Checker, there are various services available to check your personal score, such as Experian, Credit Karma, ClearScore etc. These services will give you a good idea of how your score stacks up against the average UK standard.
If the decision returned from this is positive, then there’s a good chance you’ll be accepted with one of our funders.