Bad credit car leasing
is a tricky subject to address, and causes many people a great deal of distress..here we will try to establish the issues, and how to deal with them. Car leasing with bad credit, explained
What Is Bad Credit?
Put simply, when you apply for some kind of finance or lease agreement, a team of underwriters will assess your credit-worthyness. They will not know you personally, or the exact circumstances that lead to you having bad credit…so they will conduct a credit search with a number of different credit reference agencies throughout the uk.
These credit reference agencies will have a record of the finance agreements you have entered into, it will show them the following information (in summary)
- Account balances
- Defaulted accounts
- Voluntary Arrangements (IVAs and unofficial arrangements)
- Addresses you have registered at
At the end of this credit report, there will be a “score”, usually out of 1,000 which the underwriting team will make an decision based on. Many finance companies will just take this score, and have a benchmark for acceptance or decline. For example, this may well be say 800…if your personal score is greater than 800, you get accepted..if it is below, you get declined.
It isn’t *quite* as simple as this, and in many cases the underwriter will consider the number of current finance agreements you have and suchlike..but this is the basis for decision
What Is Bad Credit Car Leasing?
Bad credit car leasing is slightly difference to conventional bad credit car finance in so much that, its not a loan at all. With bad credit car finance, the finance company are actually lending you an amount of money, over a given period of time, and charging interest on the total loan.
With car leasing, its different. This is a contract hire agreement, so you enter into a contract to hire the vehicle for a specific length of time (usually 2 or 3 years). In addition, a contract hire (with bad credit or otherwise) will have the following features.
1) Always includes the road fund license (road tax) for the term of the contract.
2) Fixed monthly repayments that do not fluctuate with bank interest rates.
3) Warranty for the period of hire
4) Usually a 2 or 3 year contract
5) Usually the mileage is specified at the beginning of the contract – with our bad credit leasing contracts, this is usually pre-set at 15,000 miles per year, but can be adjusted.
So think of car leasing as a long term car hire agreement. You aren’t borrowing any money, there is no APR to calculate, and you are not responsible for the depreciation of the asset (the vehicle).
Many people these days much prefer the idea of not worrying about the second hand value of the vehicle they drive, and leave that part to the experts. The whole process of disposing of a second hand vehicle can be a daunting one.
Obtaining Credit With A Bad Credit History
Basically, in order to obtain car leasing with bad credit, you need to find an underwriter who will consider your present situation, and not just your history. There are a couple of key important things here
- You *must* be able to afford the agreement, no-one can predict the future..but entering into a credit agreement when you simply cannot afford it is lunacy. A good underwriter will spot this quickly, and not allow things to get worse.
- You *must* be back in control of your finances. We deal with dozens of people daily who struggle with obtaining credit..a proportion of these people are still descending in a spiral of debt turning bad. You should not make things worse, gain control of your finance and try to move forward positively.
What We (Ultracar) Do That Is Different
We look at the bigger picture, and we look at the NOW, and not at your past.
Our team of underwriters will look at your present situation, they will consider your current affordability, and how easy it is to trace you (electoral role is really good for this!), based on this research they will then make an assessment of the risk involved with leasing you a new (or nearly new) vehicle.
We have a very, very high acceptance rate (usually greater than 90%) based on this, and we have many happy customers driving their vehicles right now, regardless of CCJs, Defaults and Bankruptcies.
To recap, we accept people with:
If you can afford the vehicle, and are traceable at your home address, there is a really good chance we will be able to help, thats it..we really aren’t too concerned with what has happened, but more what will happen.
If you’d like to discuss this further with an bad credit car leasing adviser, please feel free to call 01342 837 110, or you can even use our online application form here
Alternatively, you can use the short online form below to make and enquiry, and we’ll get back to you ASAP.