Do You Need A Credit Check To Lease A Vehicle? | Rivervale UK

Do You Need A Credit Check To Lease A Vehicle? | Rivervale UK

If you’re considering leasing a car, you may not know what sort of checks are involved when it comes to getting finance approved.

Leasing is a great option for many drivers due to the benefits it offers. But there are a few boxes to tick before you can start driving your new car - including a mandatory credit check.

This vital part of the lease agreement process is designed to validate your financial security, giving both you and the lender peace of mind that you can keep up with the agreed repayments.

What is a car lease credit check?

When you lease a car, you’ll be expected to make regular monthly payments. And whether it’s your first car, a sports car or a family car, the creditor will need reassurance that you can afford those payments.

To achieve this, they will carry out searches on your credit report. This is sometimes referred to as a car lease credit check.

Types of Credit Check

Credit checks fall into two different categories - soft credit checks and hard credit checks. Soft credit checks are only visible on your credit file by you.

Hard credit checks are carried out every time you apply for new credit - including credit cards, bank loans, mortgages, overdrafts and car lease deals. This type of check offers a deeper dive into your fiscal history.

Unlike a soft credit check, hard credit checks do show up on your credit file. Other lenders can see they have been carried out, and if a lender sees lots of hard credit checks on your file within a short space of file, this may have a negative impact on your credit score.

Once they have the results, they will use this information to help them decide if you’re likely to be able to keep up with the repayments and whether they are willing to approve the credit to for you to lease a car.

Who is eligible to lease?

Car Finance Calculations

What Are Credit Searches Looking For?

Credit searches and checks aren’t designed to stop you from being able to lease a vehicle. They are simply a safety net that protects you and the lender against debt and dependency.

The leasing company won’t want to risk leasing a vehicle to you if your credit score isn’t great. And it isn’t sensible for you to take out a credit agreement if it’s going to put you under financial strain.

What Does Your Credit Report Show?

  • Your credit report provides a detailed summary of your credit history, including electoral roll information for your current and previous home addresses, active and recent credit agreements (including any missed and late payments) and public records such as bankruptcies, insolvencies and county court judgements (CCJs).

  • If you want to lease a car, all of this information is important to the lender. For example, if your credit report shows that you have failed to make payments to your credit accounts in the past, this indicates that you might not be able to keep up with your monthly payments. As this is risky to the lender, they may decide not to approve your application.

  • The overall health of your credit report will have an impact on your borrowing potential.

  • If you have a good credit report, you are more likely to be accepted for a car lease deal. What’s more, you are likely to be eligible through a variety of funders, giving you a greater choice of offers.

  • If your credit report shows lots of missed payments or previous CCJs, your application for a car lease could be rejected.

What is a Credit Score?

As well as reviewing your credit report for evidence that you will be able to keep up with your repayments, finance companies will also be checking that you have a “good” overall score.

So, what exactly is a good credit score?

In the UK, credit scores are determined by three main Credit Reference Agencies (CRAs). These are Equifax, Experian and TransUnion.

Each CRA has its own ideas about what a good score is. However, a good credit score in the UK is usually considered to be between 881 and 960. A score higher than 960 is considered “excellent” and a score below 881 is considered “fair”. Here’s a simple breakdown:

Score Rating

961-999 Excellent

881-960 Good

721-880 Fair

561-720 Poor

0-560 Very poor

Man Checking Credit Score

Can You Be Refused Finance To Lease a Car?

Yes, it is possible to be refused car finance due to bad credit. If this happens, try not to be disheartened - there are still options available to you, including:

  • Potentially looking for a cheaper vehicle

  • Using a guarantor or co-signer

  • Improving your credit score

Lowering the cost of your lease

There are many different ways to lease a vehicle. Reducing the overall cost of your agreement means the monthly payments will be lower. This represents less risk to the finance company.

One way to reduce the cost of your lease deal is to downgrade the specifications of your chosen vehicle. You could also consider:

  • Choosing a different make or model

  • Retracting any optional extras

Taking out a shorter agreement or increasing the amount you pay upfront will affect the overall cost of your lease. For example, a higher initial rental payment will lower your monthly payments.

Use a guarantor or co-signer

Using a guarantor or co-signer can help to improve your chances of getting a new vehicle on a lease agreement. A guarantor is someone who signs to say that they will pay the outstanding balance on the vehicle if you can’t, however, this is not available through most finance companies.

Improving your credit score

The above options are completely viable. But the best way to get a vehicle lease agreement when you have bad credit is to take steps to improve your score.

Bad Credit

The steps required will depend on the reason you have bad credit.

For example, young drivers simply may not have had the chance to build up a good credit score yet. If this applies to you, consider opening a credit card to use for monthly purchases. Making sure the balance is paid off in full each month should help to boost your credit score.

Registering to vote is another simple way to improve your credit score.

If you have missed credit repayments in the past, it may take you longer to rebuild your score. Consider longer-term strategies like keeping up with future payments and paying off debts.

Can car leasing affect my credit score?

Whatever lease agreement you choose, leasing a car may impact your credit score. But it’s down to you whether that’s a positive or negative impact.

Keeping up with your monthly lease repayments will have a positive impact on your credit score. Missing payments or defaulting can hit your score in a negative way - and this will have an impact on your eligibility for credit in the future.

Remember, soft credit checks won’t have an impact on your credit score. And even though the initial hard credit check will show up on your score, the adverse effects of that search will be wiped out once you’ve shown that you’re able to make regular repayments.

Credit checks are a necessary part of leasing a vehicle. They ensure you and the funder are protected from the adverse effects of defaults or debts.

Car leasing with bad credit

Leasing a vehicle with Rivervale

Our simple leasing processes make the stages of leasing a van or car clear and easy to follow. When you lease a car with us, we’ll provide all the information you need to make the right decision.

At Rivervale, we are committed to providing a fair and transparent leasing process for our customers. We take the protection of your personal data seriously, and as such, we want to ensure you understand how we collect and use your information, as well as your rights under data protection legislation.

By choosing to lease a vehicle with us, you agree to the following:

Data Collection: We will collect and use your personal information to assess your eligibility for a lease, to manage your account, and to communicate with you throughout the leasing process. This may include your name, contact details, financial information, and other relevant data.

Credit Checks: We will conduct credit checks on your application to assess your ability to make payments on time. This will involve sharing your personal data with credit reference agencies.

Data Sharing: We may share your personal data with our partners and affiliates, such as insurance providers or maintenance companies, to provide you with additional services related to your lease.

Marketing: We may use your contact details to send you marketing materials about our products and services. You have the right to opt-out of these communications at any time.

Your Rights: You have the right to access, correct, and delete your personal information. You also have the right to object to the processing of your data and to withdraw your consent at any time.

If you have any questions or concerns about our use of your personal data, please contact us at, call 01273 433 480 or request a callback. We will make every effort to address your concerns and provide you with a fair and transparent leasing experience.

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