How does a car lease appear on credit file?

Terryschocorange
Terryschocorange Posts: 15 Forumite
in Credit file & ratings
Hi,

My partner is considering leasing a car for 24 months. Does anyone know how this will appear on his credit file? He is looking to pay around £200 for 24 months for a car that costs in the region of 18K. Would the total value of the car (18k) show up on his credit file or would it just be the payments that he has agreed to, ie £200 x 24 = £4800. I don''t really want him to have 18k of debt visible on his report if possible.


Thanks
«1

Comments

  • SeanG79
    SeanG79 Posts: 977 Forumite
    First Anniversary Name Dropper First Post
    Based on a few people I know with Contract Hire/Lease, there was no mention of the finance on their credit files...
  • climbingoutoftheabyss
    climbingoutoftheabyss Posts: 170 Forumite
    Yes, it does show on your credit file, although its not shown as part of usable credit.

    Yes, the £4,800 will show.

    But it goes in to the mix, it doesn't automatically look bad, indeed after 6 months if paid on time has more a positive impact.

    But it does depend on the rest of the credit score, these things don't impact in isolation.
    Unsecured debt 2008 c £45,000
    Current unsecured debt February 2016 £1,734.85
  • Terryschocorange
    Terryschocorange Posts: 15 Forumite
    SeanG79 wrote: »
    Based on a few people I know with Contract Hire/Lease, there was no mention of the finance on their credit files...


    Thanks for replying. Would be great if it didn't appear at all!
  • SeanG79
    SeanG79 Posts: 977 Forumite
    First Anniversary Name Dropper First Post
    Speak to the finance company providing the lease, they will confirm what is reported
  • GingerBob_3
    GingerBob_3 Posts: 3,659 Forumite
    If it does appear on the CRAs' files it's another example of credit file scope creep. You don't own a lease car, you rent it, so why should it appear?
  • SeanG79
    SeanG79 Posts: 977 Forumite
    First Anniversary Name Dropper First Post
    GingerBob wrote: »
    If it does appear on the CRAs' files it's another example of credit file scope creep. You don't own a lease car, you rent it, so why should it appear?

    In my experience it doesn't, unless defaulted on...
  • climbingoutoftheabyss
    climbingoutoftheabyss Posts: 170 Forumite
    If it does appear on the CRAs' files it's another example of credit file scope creep. You don't own a lease car, you rent it, so why should it appear?

    Because of the way its financed. You're not renting, you're leasing and someone is financing that, essentially lending the money to a third part and then charging them interest. The leaseholder doesn't see it as its rolled in to the contract price.

    It's perfectly reasonable for it to appear on a credit score as you cannot obtain a lease contract without a good credit score.

    However, as above, if payments are maintained then its a mostly positive effect.
    Unsecured debt 2008 c £45,000
    Current unsecured debt February 2016 £1,734.85
  • Barclayloan_query
    Barclayloan_query Posts: 70 Forumite
    I took out a contract hire vehicle recently... the value of the vehicle was displayed on my credit report as the amount 'owed' rather than my contracted payments x 24

    http://forums.moneysavingexpert.com/showthread.php?t=5343201
  • GingerBob_3
    GingerBob_3 Posts: 3,659 Forumite
    Barclayloan_query wrote: »
    I took out a contract hire vehicle recently... the value of the vehicle was displayed on my credit report as the amount 'owed' rather than my contracted payments x 24

    http://forums.moneysavingexpert.com/showthread.php?t=5343201


    Yet another criminal failing of the credit reporting system. Not only the fact that the vehicle providers scammed their customer by reporting inflated "lending" against him, but more so that it isn't even lending in the first place. The customer is paying a fee for the use of equipment. He is not buying the equipment (vehicle), nor does he ever own it. Bloody scandalous.
  • Thrugelmir
    Thrugelmir Posts: 89,546 Forumite
    Name Dropper Photogenic First Anniversary First Post
    GingerBob wrote: »
    Yet another criminal failing of the credit reporting system. Not only the fact that the vehicle providers scammed their customer by reporting inflated "lending" against him, but more so that it isn't even lending in the first place. The customer is paying a fee for the use of equipment. He is not buying the equipment (vehicle), nor does he ever own it. Bloody scandalous.

    The person renting the car is responsible for it. That's the bottom line. Irrespective of the amount they are liable to pay. Taking a one sided view leads one straight up dead end alleys sometimes.
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