Let's talk about credit and leasing
#31
I've leased 6 Toyotas, all through TFS/LFS with fair to good credit and never once received a letter asking for more money or they'll take the car back. Once the deal is finalized at the finance manager's office and both parties signed it, it's a done deal and I'm stuck with the car until the lease ends or traded in early.
#32
yeah.. the finance guy said they originally didnt want to do the deal at all. but their sales director called in a favor with lexus. they originally wanted 9 security deposits of $500 totaling $4500... but then he said because of the favor that its only 4 MSDs of $500 totaling $2000. only dropping my payment $31 dollars by reducing money factor from .0009 to .00032 ... they said that the MSD is fully refundable at the end of the lease or fully applicable to the residual should I buy out the lease.. but seems like if i dont do it they will take the car back =\
Then again, if they knew their stuff they should have seen you didnt qualify for that rate in the first place!?
Some "favor" they are doing for you there, having you cover for their mistake... Anyhow, if you want to keep the car seems like your going to have to pay the msd's, which really isnt a bad thing.. you got a smokin deal on the car anyways!!
#33
Driver School Candidate
Sounds to me like they gave you the tier 1+ mf of .00090 by mistake if you are a 710 fico score. Tier 1+ is for credit score 720 or above. I would perhaps try the other credit bureaus to see if you have higher scores that could bring you into tier 1+ range, although I would imagine any finance mgr that knows his stuff tried this already. It sounds like now they are simply trying to get you to come up with cash to get you into that rate/payment..
Then again, if they knew their stuff they should have seen you didnt qualify for that rate in the first place!?
Some "favor" they are doing for you there, having you cover for their mistake... Anyhow, if you want to keep the car seems like your going to have to pay the msd's, which really isnt a bad thing.. you got a smokin deal on the car anyways!!
Then again, if they knew their stuff they should have seen you didnt qualify for that rate in the first place!?
Some "favor" they are doing for you there, having you cover for their mistake... Anyhow, if you want to keep the car seems like your going to have to pay the msd's, which really isnt a bad thing.. you got a smokin deal on the car anyways!!
hahaha yeah but they offered to lower my MF to .00032 after I pay the 3 MSD. Payment would've lowered to $452... But doesnt matter I had my Sales Manager call his buddy and ask for a favor to get the deal done without the MSD.. Long story short. Im keeping the car with no MSD to pay but I do owe my 1st payment which Im making tonight. If they try to make me pay the MSD Ill simply unwind the vehicle. I want the car but I dont need the car
#34
Lexus Fanatic
So you drove away in the car without making your first payment? That too is very odd. First payment has always been due on signing on EVERY car I've ever leased, except the GS because the first payment was waived.
#35
Lead Lap
However, your credit score doesnt mean squat if you dont have a good and extensive history. When i was younger and only had 1 credit card, by using the card a lot and not missing a payment my FICO score was 720 but i couldn't even get a lease because i had no history or anything paid off. Also your income to debt ratio is VERY important. Credit score is not that important. I know guys with a 610 score that got financed for a $700,000 house. Its all about your credit history not your score.
Last edited by PirelliRC; 01-23-15 at 04:42 PM.
#36
Driver School Candidate
I also leased my 2013 Nissan Maxima with absolute $0 down. But I guess being a Salesman for Nissan might have had something to do with it lol..
Last edited by Laostuh; 01-23-15 at 04:50 PM.
#37
exclusive matchup
iTrader: (4)
my guess is they might be playing with the number games here to make up some of the difference
#38
Lexus Fanatic
However, your credit score doesnt mean squat if you dont have a good and extensive history. When i was younger and only had 1 credit card, by using the card a lot and not missing a payment my FICO score was 720 but i couldn't even get a lease because i had no history or anything paid off. Also your income to debt ratio is VERY important. Credit score is not that important. I know guys with a 610 score that got financed for a $700,000 house. Its all about your credit history not your score.
1. You are correct that for a car lease credit score is important, but what is more important is your prior car and mortgage credit. Leases are much higher risk than a finance because there is no equity build. They want to see prior car credit or/and a mortgage before they will approve a lease typically, even with very good credit. If you have a 650 and a rich car credit history, you're probably fine. Generally unless you have poor credit they never ask for proof of income. I have never been asked to document income when leasing or buying a car. Never one time. Debt to income is less important because they don't verify the income.
2. For the mortgage, its totally different. Your debt to income is of extreme importance, but so is credit score. The type of mortgage and downpayment has a huge impact too. If your friend has a 610 score and got financed for a $700,000 house, I can tell you with 100% certainty that was not a conventional/conforming/conforming jumbo mortgage. If it was less than 20% down you would have MI companies to deal with and they would never insure a mortgage from a borrower with a score that low. The price of the house doesn't really matter outside of conforming loan limits, and conforming jumbo loan limits that depend on your area. So, for instance it doesn't really requite better credit to get a $650,000 loan than it does to get a $150,000 loan. It just requires more income. Is it easier to get a 80% loan on a 600,000 house or a 50% loan on a $600,000 house? The answer is its exactly the same...only difference is less income is required to qualify for the 50% loan.
Now, he could presumably have gotten an FHA or a VA mortgage. Much lower credit standards, but even then MOST lenders won't lend below a 640, and VERY FEW lenders will lend below a 620, and almost none will lend below a 600...even though HUD and the VA technically allow it.
Unless its a VA or FHA mortgage, its some sort of a hard money or portfolio loan and he's paying a huge rate.
With that said, I have seen many people with 800+ scores and millions of dollars in assets be turned down for a $250,000 mortgage because they have no earned income with which to qualify. Its an interesting market out there. Those people for instance would have no problems getting car loans/leases.
All in all though, your credit score is the single most important piece of the puzzle when you're trying to apply for credit, whatever that credit is.
Last edited by SW17LS; 01-23-15 at 07:07 PM.
#39
What about self employed buyers? Do the banks, credit unions and LFS want to verify income via 2 year's tax returns, etc. to approve a Lexus loan or lease application even if the applicant has a high credit score and long mortgage & credit card history?
Last edited by gemigniani; 01-24-15 at 01:43 AM.
#40
Lexus Test Driver
Nope. Through about 20 vehicles financed in 4 years, we have only had income verification once.
#41
You need to get your hands on the FICO score. They can be VERY different. I'm in the Real Estate business and we get people all the time that are shocked by their FICO scores when they apply for a mortgage because they pay for credit monitoring with different models. If you have an issue like this thats when they become the most different.
Get them from www.myfico.com. Worth the $40 if you're going to be applying for credit. You can try to dispute that late too.
Your FICO score could be better...or worse. I've seen them 70-80 points different.
It really may be fine.
The penalty is all the remaining lease payments. It always is. Might still be less...
Get them from www.myfico.com. Worth the $40 if you're going to be applying for credit. You can try to dispute that late too.
Your FICO score could be better...or worse. I've seen them 70-80 points different.
It really may be fine.
The penalty is all the remaining lease payments. It always is. Might still be less...
#42
Lexus Fanatic
I'm self employed. Nobody has ever asked me to verify income, ever.
#43
Lead Lap
Former 2013 GS350 F-Sport owner for about a year, decided to do the environmental "thing" (my wife is a green energy consultant) and traded in on a Nissan Leaf.
BIG MISTAKE
I've had the Leaf for about 1.5 years of a 3 year lease, and I can't stand it. Interestingly, it's barely driven since my wife doesn't like it either.
I decided to look at getting back into a GS350 F-Sport, and reached out to some dealers with a severely underwater Nissan Leaf trade-in. Fortunately, I have enough money to put down to take care of the negative equity, and get back to zero so to speak.
Here's where it gets interesting.
6 months ago I left for a new position, with a new company in a new state (from GA to FL). I thought I had paid off a corporate card I had, but it turns out that I owed $1500 on it. Unfortunately, I was the only person that didn't know this, and was not contacted by the creditor since they messed up my forwarding address, and there is a policy not to contact *former* corporate card holders by phone
So, they slapped me with a 90days late on my credit report today
This wrecked an otherwise nice credit history (no lates, but only 6 years in the country), and took my score from 705 down to 611.
I will be calling the creditor tomorrow to find out what they can do for me, but I intended on leasing the new car in a couple of weeks.
Based on a flawless car payment history, including one with LFS, can I expect to obtain a lease? The quote I received prior to finding out about the corporate card issue is below, which, relative to what other folks in FL are receiving, doesn't seem all that good. Frankly, I'd prefer a shorter term (36 months), but now I'm concerned that I won't be approved at all.
So, thoughts on all of this?
Right now, my quote looks like this:
Vehicle Price: $56,025.00
Savings: - $4,341.62
Vehicle Selling Price: $51,683.38
Trade-in Value: - $18,000.00
Difference: $34,683.38
Lien Payoff (estimate): + $32,159.38
Sales Tax (estimate): + $3,199.43
Tag/Registration Fees (estimate): + $225.00
Tire/Battery/MVWEA: + $9.00
Title Fee: + $2.00
Dealer Service Fee: + $699.95
Electronic Filing: + $98.75
Balance Due (estimate): $70,076.89
Lease Options: 48 months, 10,000 miles, $599 /month, $13,000 down
Residual of $30,813.75
Rental Rate: 0.00090
BIG MISTAKE
I've had the Leaf for about 1.5 years of a 3 year lease, and I can't stand it. Interestingly, it's barely driven since my wife doesn't like it either.
I decided to look at getting back into a GS350 F-Sport, and reached out to some dealers with a severely underwater Nissan Leaf trade-in. Fortunately, I have enough money to put down to take care of the negative equity, and get back to zero so to speak.
Here's where it gets interesting.
6 months ago I left for a new position, with a new company in a new state (from GA to FL). I thought I had paid off a corporate card I had, but it turns out that I owed $1500 on it. Unfortunately, I was the only person that didn't know this, and was not contacted by the creditor since they messed up my forwarding address, and there is a policy not to contact *former* corporate card holders by phone
So, they slapped me with a 90days late on my credit report today
This wrecked an otherwise nice credit history (no lates, but only 6 years in the country), and took my score from 705 down to 611.
I will be calling the creditor tomorrow to find out what they can do for me, but I intended on leasing the new car in a couple of weeks.
Based on a flawless car payment history, including one with LFS, can I expect to obtain a lease? The quote I received prior to finding out about the corporate card issue is below, which, relative to what other folks in FL are receiving, doesn't seem all that good. Frankly, I'd prefer a shorter term (36 months), but now I'm concerned that I won't be approved at all.
So, thoughts on all of this?
Right now, my quote looks like this:
Vehicle Price: $56,025.00
Savings: - $4,341.62
Vehicle Selling Price: $51,683.38
Trade-in Value: - $18,000.00
Difference: $34,683.38
Lien Payoff (estimate): + $32,159.38
Sales Tax (estimate): + $3,199.43
Tag/Registration Fees (estimate): + $225.00
Tire/Battery/MVWEA: + $9.00
Title Fee: + $2.00
Dealer Service Fee: + $699.95
Electronic Filing: + $98.75
Balance Due (estimate): $70,076.89
Lease Options: 48 months, 10,000 miles, $599 /month, $13,000 down
Residual of $30,813.75
Rental Rate: 0.00090
#44
Lexus Test Driver
nothing personal but especially since the meltdown in 2008 neither of your credit scores are very good. when I leased my IS 350 my fico was 740 and the dealer said I needed 744 or higher for tier one. they gave it to me anyway. right after the meltdown there were plenty of stories where you needed at LEAST 720 to get mortages or loans with better rates. fortunately its not been a problem for me but they really want to see higher scores. Im over 800 now so I am not worried at all but if people think the credit score is meaningless they are in for a rude awakening.
#45
Lexus Fanatic
Its not that credit isn't available at lower scores, it is, but the most favorable rates are not. Lenders be they mortgage lenders or auto lenders or whatever keep nudging the requirements for their top tiers higher. For LFS Tier 1+ used to be 720, now apparently its 744? For a mortgage with a lot of lenders there are rate adjusters at 820, 800, 780, 750, 720, so on and so forth. Used to be if you had a 700 you had the best mortgage rates, now to get them you need an 820, which is a VERY rare score.
Often the rate adjustments are very subtle.
Often the rate adjustments are very subtle.
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