Car Leasing with Bad Credit; The Facts

Personal credit has become one of the more pertinent issues in modern life as we head to a more “cashless society” and move away from outright purchasing of goods and services.

The difficulty is that all products and services have different rules and considerations; for example taking out 'finance' on a mobile phone contract is a significantly lower undertaking than leasing a new vehicle or obtaining a mortgage on your house. Without clear advice, some customers try to enter into contracts which are either unsuitable for their needs and requirements or they try to obtain good/services which do not meet their individual credit profile.

Contract hire and car leasing is a credit-based product. What this means practically is that in order for you to procure a lease car or van from our panel of selected lease vehicle financial providers (which we will introduce you to,) you will first have to complete a credit-check.

Can Bad Credit Customers Lease a Car?

To dispel the myth/misnomer, car leasing is not for customers who have bad credit. This is not something which you should consider as an alternative to purchasing a vehicle and/or where you have been declined for credit. You must differentiate car leasing from a non-status product like daily or weekly car hire arrangements.

What Kind of Credit Checks do Lease Companies Undertake?

In order to proceed with leasing a vehicle from a credit broker like CarLease UK, 'credit checks' will be performed at certain stages of the proposal. For this reason customers will be asked to supply us with various forms of information about themselves...

Information required to lease a vehicle:

As part of providing our financial companies and lease car suppliers with detailed and accurate information, we will ask for you to supply:

  • Your full name;
  • Date of birth;
  • Email Address;
  • Telephone number – home and mobile;
  • Address history - minimum of 5 years;
  • Employment history – minimum of 3 years;
  • Bank details; and
  • Full income and expenditure analysis.

In addition, as part of Treating Customers Fairly, we ask customers to sign and confirm the following below:

  1. Please can you carefully read this proposal form (click here) and complete all of the fields contained within. By completing this application, you are confirming that the information supplied to us is both true and accurate, as this will be used by our team as part of the application process for financing the vehicle. Additionally, in returning this form to us you are confirming that we have authority to submit your details to our lenders. Please be aware that our lenders may check your details with credit reference and fraud prevention agencies, as part of determining your suitability for the proposed application. If you have any concerns about the credit check and application process, please contact us before returning the form.
  1. Are there any expected changes in your personal circumstances that would result in you being unable to make repayments over the term of this vehicle finance agreement.
  1. Does this agreement replace an existing financial commitment that will be repaid as result of this agreement.

When you are completing the proposal form please ensure you accurately set out the details to minimise disruptions or credit declines.

Some useful points to note:

  • Ensure your full name matches the information on your full driving licence;
  • Ensure you are registered on the electoral register for the address which you are using for the application;
  • If this is replacing a vehicle which is not with CarLease UK, supply this information to us; and
  • Ensure you have a copy of your driving licence and proof of address dated within the last 3 months’ as these may be required at a later stage.

Before speaking to the team here, if you do have any concerns regarding your credit-status, it is worth getting a 'credit report' initially (free 'credit report' providers can be found online.) This will help you to understand some of the basic components of your credit profile which a finance company/ vehicle supplier will use to assess your suitability.

NB/ Sometimes customers may find that their credit status is classed as 'bad' or 'poor' when (for example) they have used a pay-day loan in the last 6 years, as this alone may preclude your ability to take out a lease...

Credit checks are an obligatory part of leasing any new vehicle, car leasing customers with bad credit and lease car customers with good credit undergo the same credit checking process before being successful in leasing a new vehicle. If you would like to know more about what kind of credit checks (soft and hard) are undertaken simply contact us in advance of submitting your application.

Further help and advice on car leasing is available on THIS PAGE of our website, likewise we also cover off topical lease car points of interest in our blog pages.

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Carlease (UK) Ltd t/a CarLease UK, e-car lease, VanLease UK and School Minibus Leasing UK is a credit broker and not a lender and will introduce you to a limited number of finance providers which have been carefully selected by us - please note that we do not provide independent financial advice. The finance providers that we use may make payment to us if you elect to enter into an agreement with them. The amount we receive will affect what you pay for your vehicle. The commission received may or may not be capped in accordance with that finance company’s policy. We may also receive an extra amount based on how much business we provide to that finance company, the types of products you take from the finance company and the quality of our service. For Regulated Customers you can ask us about the payments we receive from the finance company so long as this is in good time before the agreement is made. Failure to maintain rentals may result in the vehicle being withdrawn (this may affect your credit).

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