Questions to Ask When Leasing a Car with Bad Credit

Does your decision between leasing and buying a car depend on which will save you more money? Savings is a good point of comparison, but you shouldnít miss the point that you pay more for a caróregardless of whether you took out a loan for or leased itówhen you have bad credit. So as you think carefully about your choices, consider asking yourself the following questions before you actually lease your car.

Does my credit qualify?
Even if they can accept applications from people with bad credit, lessors still have a cap on the lowest credit score they can accept. If your credit is really, really bad, you might not qualify for leasing. Itís necessary then to check up on your credit before applying for a car lease.

Do I drive a lot?
Check with your lifestyle before leasing a car. Does your work require you to be on the road for most of the time? Or do you just need a car to drive around town? Leasing is not the best way to finance a car if you are often behind the wheel. This is because the miles you can drive in a lease are inherently limited. In most cases, you will only be allowed to drive up to 15,000 miles. If you exceed, you will pay the extra miles.

How long do I want to keep the car?
Are you going to stick with a car for at least 4 years? If yes, consider taking out a loan to purchase a car instead of leasing it. Lease agreements are shorter than loan agreements. They usually last for two to four years. Loan terms can be extended up to 96 months or eight years. This is an important area to decide on carefully because early termination of a lease agreement often corresponds to a hefty fee.

How much can I afford to pay every month?
Are you tight on a budget? Take a good look at your monthly take-home and expenses. Will you have enough cash left for monthly car loan payments? If not, consider leasing the car. Auto leases have lower monthly payments. For one, the term is short and two; you donít pay for the entire vehicle but only for its depreciation while in your possession.

Do I really need to own a car?
Donít lease your car if you only need a temporary one. In leasing, you donít get to own the car at the end of the lease unless you buy it from the lessor. You get to drive the car but it is in the lessorís possession the entire time. This is also one reason why monthly lease payments are lower than loan payments. You donít pay for the entire car to be your own.

How can a car lease help me rebuild my credit?
Both auto loans and car leases can help improve bad credit. But your concern right now should be what you can do to boost your credit. The one secret that can pull you up is making payments on time. Thereís no better way than this. Keep in mind that lenders and lessors need to see a solid proof that a borrower can pay up before giving him or her a decision.
 
     

 

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Auto Approval Center is a lead provider to lenders around the US. Average APR rates range from 3.2% to 24% depending on credit. Some dealers/lenders may have implications for non-payment or late payments, please see your specific terms for more information. By applying with Auto Approval Center, you agree to have your credit pulled for lending purposes and this could have an impact to your credit score. Thank You for your business!
 

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