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Anyone ever hear of this kind of Lease??????


sutliffhl21
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The last post in this topic was posted 5366 days ago. 

 

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I have really bad...I mean bad credit. 2 repo's, a BK from 2005 and a whole lot of chargeoff's. My FICO is in the mid 400's. I was laid off from my job a while back..and this was the reult. I am now working again, and ave about $12k for a downpayment on a car. The F&I guy told me that he isnt sure if he could get it bought as a purchase, even with that downpayment, but he told me about a"pre-paid" lease. Its where I basically pay upfront all the payments and at the end, I can either buy it out or turn it back in. He said that theres no risk in the lenders eyes. My question is, has anyone ever heard of this kind of lease, and secondly, if it does exist, does your credit even matter if youre doing a pre-paid lease? Would I be able to do it? FYI, I was looking at an 08 Mazda 3, which stickers for $19k

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What this means is you are prepaying the depreciation and interest charge up front. How many years are you looking at?

 

And there is a risk, probably a larger one. You are essentially renting the vehicle for x amount of months...what if you ruin the car? If you have a history of bad credit, they may think you will ruin their car and walk away. Remember the car is worth a preset value (residual) assuming it's in good condition....

 

If you buy the car, you can do whatever you want with it....

 

So tell us, what kind of car, what kind of term, and what's the negotiated price and back end residual?

 

Most importantly what are the fees involved? ie acquisition, disposition, etc.

 

Then we can tell you whether it's a good deal or not.

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Yes, I've had customers who would be approvable on a prepaid lease, where they would not normally be approved for either a retail installment contract or a retail lease contract.

 

This is done with the captive lender which is essentially in this case FMCC.

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