Lease a Car – Need Good Credit?

Do you need good credit to lease a car?

You must have good credit if you want to lease a car — usually better credit than if you were buying your car with a loan.

Since leasing is often confused with renting, it’s a common misconception that leasing doesn’t require a credit check or a good credit score.

Many car companies and banks lost money on car leasing in the last few years due to customers defaulting on their lease agreements. As a result, leasing is now requires higher credit scores than ever before. Furthermore, leasing is a bigger risk to a finance company or bank than a conventional loan, especially if there’s no down payment, since payments are lower and don’t keep up with the depreciating value of the vehicle.

How good does your credit need to be to lease a car?

There are essentially two kinds of car lease deals — normal and promotional deals.

A promotional car lease deal is one offered by automakers and their dealers for a limited time period (usually a month or two). The deals are heavily advertised and can be viewed on car company web sites (see Best Car Deals for current deals).

In most cases, these special deals are based on reduced prices, low money factors, and boosted lease-end residual values. One drawback is that the deals typically only apply only to a few models and styles, not every vehicle in a car company’s lineup. Furthermore, there may be mileage restrictions and down payment requirements.

In nearly every case, when viewing the small-print details of such promotional car lease deals, you’ll find a statement similar to this: “only available to well qualified customers.”

What does this kind of statement mean?

It means you must have not only good, but excellent credit to take advantage of the advertised lease deal. Car companies want to make sure that customers who accept the deals have a low risk of defaulting (failing to pay, ending the lease early, returning the car before end of lease). A minimum credit score of about 700 or 720 is needed to qualify for the offer. A few allow a score of 680 to qualify. Some offers even specify the exact credit score required.

Before you visit a dealer to consider a special car lease deal, you should know your credit score beforehand. Don’t wait and let a dealer surprise you with your score. What’s your FICO score? Find out now when you check your credit report for $1 at!

What if you have good credit, but not necessarily excellent credit?

You may still be able to get a normal non-promotional car lease deal even with less-than-perfect credit. However, the lower your score below the 700 mark, the less your chances of being approved, and it’s almost certain that you won’t be able to take advantage of special lease offers.

“ The finance rate you pay for your car lease directly depends on your credit score”

What's Your Credit Score?

If your credit score is only a bit below “prime”, you will be able to lease but your money factor (lease finance rate) will be higher than for someone with a better score.  You may also be required to make a higher down payment (cap cost reduction). In extreme cases, you may also be required to make a refundable security deposit.

There are no “sub-prime” financing providers for leases as there are for loans, which makes it easier to get a car loan with bad credit than get a lease with bad credit.

If you do not have good credit and need a car, a sub-prime loan might be your best option. Consider a reputable online lender such as Auto Credit Express and get a free no-obligation quote. This company specializes in car loans for people with poor credit, bankruptcies, and repossessions.


Do you need good credit to lease a car? The short answer is yes. You need better credit than if you buy a car with a loan. And you need extra good credit if you want to take advantage of special advertised lease deals.


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