What Credit Score Is Needed to Lease a Car?

Maybe you prefer the feeling of driving a new car every few years. Or maybe the economics of leasing a car fits your lifestyle better than buying one. No matter the reason you’re looking to lease, you can expect lenders to first check your credit score and credit history to determine your eligibility and lease terms.

While there’s no minimum score needed to lease a car, it’s a good idea to make sure your credit score is in the best possible shape to boost your chances of approval and to qualify for better lease terms. Here’s why.

There’s no set credit score number that will automatically qualify you for – or prevent you from – leasing a car. But as with other credit and lending situations, like getting a mortgage, a personal loan, or opening a new credit card, the higher your credit score, the more favorable terms you can expect.

 
That’s because a higher credit score makes you less risky in the eyes of lenders. Less perceived risk typically translates to a lower interest rate, which means you’ll pay less each month and over the life of the lease (generally between two and four years). It also could mean being able to put down less money at lease origination. Generally, a 760 credit score or higher is the sweet spot for qualifying for the best rates for all types of lending.¹

In its State of the Automotive Finance Market Q4 2021 report, Experian, one of the three major credit bureaus, showed how credit score plays a part in how much money you could expect to pay per month on a car lease:

Average Monthly Lease Payment by Credit Score²

Since 2019, Experian’s data has shown a difference of roughly $20 from the highest credit score tier to the lowest. While that may not seem like much at first, remember this is per month. If the typical car lease is three years, that means an extra $720, on average, over the length of the lease (36 months x $20). Payments could be higher or lower depending on the dealership and the negotiated terms of your deal.

For most credit scoring models, a credit score below 600 is typically considered less than ideal for getting approved for credit and acquiring more favorable loan terms. You may have heard this range referred to as “bad credit,” but the credit scoring companies label scores in this range as “fair,” “poor,” or “very poor.” Specifically, FICO considers 580-669 as “fair” and 300-579 as “poor.” VantageScore considers 500-600 as “poor” and 300-499 as “very poor.”

But as long as you’re in a financial position to make lease payments on time and in full, don’t let a low credit score deter you from trying to lease a car. Seventeen percent of new leases in the fourth quarter of 2021 were given to people with credit scores of 660 or lower, according to the same Experian research. That percentage has been quite consistent over the past three years of data.

New Leases³

With a low credit score, however, you might have to make a significant down payment and accept a higher than average interest rate.⁴ Your credit score might also help determine the type of car you can lease. For example, a dealership may be more likely to lease an economy car to someone with bad credit than an expensive luxury vehicle.