If you lease a car with bad credit, it makes sense that you will pay more than a person with good credit. This is protection for the bank that is lending you money. That's why if it is already a challenge to find additional money in your monthly budget, you should only lease a vehicle with bad credit when it is actually an emergency. Take a look at your transportation choices to determine if you have other choices such as repairing your current car, carpooling with friends or coworkers, or taking the bus for a few months or more while you work on strengthening your credit. Even a few months of paying bills on time can increase your credit score. If you can put off buying or leasing a car for a couple months, you might find yourself with a high enough credit score to receive a lower interest rate.
2. What's My Current Credit Score?
Don’t simply assume have a low credit score. Discover for yourself where your credit stands, what has had an effect on your credit, and make sure there's no suspicious activity on your report. Next, bring your credit report with you when you talk with the finance team at Winter Chevrolet. They could be able to help you depending on the reason for your low credit score. Consider that you can get a complimentary credit report once a year.
3. If You Are Able, Go With a Shorter Lease Contract
Interest rates are typically smaller for shorter term leases, which means that you will end up paying less for the vehicle while you lease it. This also means that when you are no longer making your monthly payments, you can concentrate on paying off other debts and continuing to boost your credit score before your next big purchase.Then you can consider leasing another car with a lower rate, or buying one with Chevrolet finance options, and getting the best interest rate available.
4. Should I Look for a New Car, a Late-Model Car or an Old Car?
You might think that an earlier year model car will have a lower cost, but actually interest rates can be higher on older vehicles.
Think about searching for leases on brand new cars at first, then newer used cars, since these are the cars that tend to offer the lowest interest or lease rates. Keep in mind that certain states forbid leases on pre-owned vehicles. Work out the best lease deal you can, depending on how much you are able to afford to spend on a monthly car payment. It's still likely that you could find a more cost-effective deal on a used car, so make sure to evaluate all of your choices before making your final decision…and putting money down.
5. Should I Attempt to Get a Cosigner?
Conditional on your financial situation, having a cosigner for your car lease may be the best choice to get a lower rate. Think about looking for a cosigner if any of the following apply to you:
• You have a low credit score. • Your income is lower than the minimum required for a loan. • You do not have a steady income. • You have a high debt-to-income ratio.
Cosigning on a car lease is a huge responsibility. The cosigner will be responsible for making payments on your behalf if you aren't able to, so only get a cosigner if you are sure you can make the payments promptly. If you can make your monthly lease payments, having a cosigner may help decrease the amount you have to pay on the lease.
We hope this short guide has been helpful. If you have additional questions about leasing a car with a low credit score, simply give our Chevrolet finance team a call at (925) 526-6071. With good or bad credit, we're happy to advise you with our lease deals in the bay area.