Getting a car loan doesn't have to be a nightmare, even with bad credit.

Do you have to put a deposit down when leasing a car? No, you don’t. However,  a $0 down payment car finance is also possible with the right dealership. 

Buyers usually pay 20-30% of the car’s price upfront with a traditional loan. Which is one reason why you might be considering a lease with a lower down payment.

Instead, you can avoid the headaches’s of trying to get a car lease and apply for a bad credit auto loan today and own your own vehicle. 

If you’re still sold on getting a 6 month lease then you can also check out bad credit car leasing or read on.


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Let’s look at how a 6 month car lease no deposit works.

1. Special promotions

When an auto manufacturer intends to launch a new series of either a saloon or SUV, they’ll use the first model to get feedback. This information enables them to create relevant features for upcoming editions. So, the company will launch the car with a no deposit lease option for buyers looking for short-term commitment.
You might also run into a new buy here pay here car dealership near you that’s offering no money down leases for a specified period. The main intention is gaining some market share in new terrain. As a buyer, you get to pay better monthly payments since the new seller wants you to market them by word of mouth.

2. Full-time deals

Due to the high demand for cars, some dealerships offer $0 deposit car leases every day. These usually are medium or large-sized brands have been in the industry for at least 10 years. Such dealerships generate high profits that enable them to offer this service consistently.
Buyers have more car options than in a special promotion because the auto manufacturer limits you to a specific model. When you become a frequent customer, the dealership might book the latest cars for you at no extra cost.

What do you need to get this type of auto lease?

1. An excellent credit score

Car dealerships offer no money down leases to buyers with credit ratings ranging from 680 to 850. Such a high score indicates that a buyer has experience taking on similar credit in his or her past. It’s also a strong indicator of high financial stability.

2. Meet the gross monthly income requirement

Each dealership has a monthly income requirement in order to filter out buyers with a high likelihood of default. Buyers have to prove their financial stability by presenting their pay stubs and tax returns.

3. Have a low debt-to-income ratio

Debt-to-income ratio refers to the percentage of your monthly debt payments compared to your gross salary. If someone makes $5,000 a month but his or her debt payments amount to $2,500, the debt to income ratio is 50%. That’s quite unsafe.
Dealerships mostly focus on buyers whose debt to income ratio is below 40%.

4. Driving license

Presenting your driving license enables the dealership to verify your identity. It also allows you to go on test drives, unlike unlicensed drivers.

Pros and Cons

What are the pros?

1. Ideal for people who’ve relocated to a new area temporarily

Assume you’re a doctor based in New Mexico working in the public health sector. You get a notice informing you to relocate to Atlanta in the next 30 days. In this situation, you can let your wife have the car and you’ll get a new one once you settle down in your new workstation.
It’s a better alternative to saving for another car because one ends up tying a lot of their money on car payments. You also get to choose the car that’s suitable for that environment. You’re better off in an SUV while working in a remote area than using a saloon.

2. More affordable than an auto loan

When your planning for an auto loan, one needs to pay 20-30% of a car’s price in order to get financing. If a buyer has bad credit, they pay expensive interest rates. This type of financing discourages many people from buying their dream cars.
A $0 deposit lease allows you to make your dreams come true because you don’t need to pay such a high down payment similar to an auto loan. The interest rates are friendly thanks to your excellent credit rating.

3. Access to new and used cars

Leasing gives you access to a variety of new cars. If you love small cars, you can use this approach to get a new 2018 Honda Fit or Nissan Versa. They’re among the best-rated subcompact cars and you can get to try both once your first lease expires.
If you’re planning to downgrade to a more affordable car that doesn’t guzzle fuel, you can still get a good quality used car. The monthly payments are lower than a new car due to depreciation in the car’s value.
Trading in your car

4. Best option if you’re planning a transition

A zero deposit car lease enables you to step out of your familiarity zone. If you’ve driven saloons all your life, perhaps it’s time to experience what owning an SUV feels like. It’s not a long-term commitment because you’re just signing up for six months.
Sampling allows you to learn how to manage a bigger car through practical experience. Doing this helps you to know the mistakes to avoid so that you can minimize repair expenses when you buy a similar car. For instance, learning how to pack a big vehicle between two cars requires a lot of practice.
How to qualify for an auto loan

5. Low car maintenance expenses

Buying a new car gives one confidence in knowing that all parts are in excellent condition. You won’t experience any problems or have to do any replacements. Car batteries last at least three years, which means that there’s no likelihood of you buying a new battery during the lease period.
On the other hand, an auto loan puts a toll on your pockets. You’ll have to purchase a new set of tires because they wear out after two years. After covering 25,000 miles, you need to replace your brake pads. The auto finance company won’t deduct these expenses from your next monthly payment.
Suggested topic: Car repossession

5. What are the cons?

1. Penalties for excess mileage

Signing up for a lease also means obligating to a long list of rules. It’s worse than borrowing your friend’s car because they won’t bother to check the odometer. Car dealerships, on the other hand, limit your freedom of movement by setting a maximum mileage limit.
What happens when a buyer exceeds their limit? The car dealership fines them for every excess mile. The rate can be as high as $50. If you use the car one week after your hitting your cap, the fines can be enough for two monthly payments.

2. You pay for scratches

Car dealerships usually do thorough inspections when buyers return leased cars. The inspector notes every crack, scratch, and tear no matter how small. Lenders expect you to pay for these damages even though they’re virtually negligible. This is why some people complain about hidden costs at the end of their leases.
Are these costs avoidable? Certainly not. Even if you drive your car just once or twice a week and keep it inside an enclosed parking spot, the inspector will always spot damage. This can ruin your leasing experience permanently.

3. Expensive monthly payments

When the deal sounds enticing, there’s always a catch behind it. A zero deposit lease deal sounds fantastic because everyone believes that they can get better cars using this option. Once the dealership baits you in, they slap you in the face with costly monthly payments.
These high payments don’t contribute to your equity. You’ll still walk away just the same way you came inside the dealership. Auto loan payments bring you closer towards full ownership and they build your credit score as well.
Suggested read: Credit score and insurance premiums

Is it worth it?

This type of financing is ideal for someone looking to own a car temporarily. It’s an advisable option when you want to upgrade to a luxury car. By owning a Mercedes for 6 months, you’ll learn the best cleaners for your interior and good mechanics in town.