More than 43 million Americans have a FICO credit score of 599 or less, which makes up quite a sizable chunk of the population. A poor credit score hinders your ability to rebuild your credit by borrowing, but we have a solution for this in the form of lease purchase programs.
Lease purchase is a program that lets a buyer and a seller get into a lease period after which the borrower can purchase the property in question. The lease program then reports your lease payments to credit bureaus for the duration of your lease thereby building your credit score. You, however, need to make payments in time to avoid further damaging your credit score.
Lease purchase also enables you to make significant property purchases such as furnishing your home and other basic comforts. If you lack credit history, you can also build it using the lease program.
Early payment options mean that you can achieve your targets faster as long as you don’t bite off more than you can chew. When you limit your new credit source only to what you can afford, you will avoid tarnishing your credit score some more.
Also note that using automatic payments is the best thing you can do because you will be sure of always making your payments on time.
Advantages of a Lease Purchase Program
Apart from having instant approvals and no documentation needed for most applicants, you can also expect the following pros from lease purchase programs:
- Low income requirements for applicants
- Early payment options of 90 days
- Multiple options available for the lease
- No down payment nor lower monthly payments
- Terms up to 24 months long
- The ability for applicants to make more or bigger purchases
More Tips to Improve Your Credit
Additionally, you can use apps like Credit Karma and Experian Boost to help you rebuild your credit score. They work by showing you gaps in your credit reports which may be contributing to poor scores as well as showing you how you can scale up.
You can open other lines of credit with your credit cards as Credit Karma suggests, for instance, mortgages and auto loans. Make sure to always go for early payment options whenever possible as this will help you get on your way to a better financial future faster.