Another financing option that lies somewhere between leasing or buying cars is lease-to-own, or rent-to-own, vehicles. The main advantage of lease-to-own cars. Generally, this type of financing option does not require a credit check which makes it more accessible to consumers. You may qualify for a lease-to-own deal even if your credit history is less than optimal.
The only requirements to be eligible for a rent-to-own deal is proof of identity, income, and residence. A down payment may also be required to start a lease-to-own deal. Continue reading below to learn more about the requirements and benefits of leasing to own a car.
Depending on how much the vehicle costs, payments usually range from around $75 to $100 per week. There is no interest on these payments, but you will be charged a late fee if you miss a payment.
Note: Lease-to-own programs can often come with a higher frequency of payments, generally weekly or bi-weekly payments for your vehicle.
In most cases, payments for a lease-to-own contract are made directly to the car dealership. However, there may be some bill-paying services that help manage payments.
One of the most helpful benefits of a rent-to-own vehicle is that some of your payments during the lease will go towards purchasing the car later.
Note: Dealerships that offer lease-to-own deals typically target subprime lending markets.
If you cannot decide between signing a lease or getting an auto loan for a car, a lease-to-own deal may be the best compromise between the two options.