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Leases and Credit Ratings

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2 replies to this topic

#1 of 3 OFFLINE   Shawn Solar

Shawn Solar

    Supporting Actor

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Posted August 23 2006 - 12:55 PM

Hello all,

I was just wondering for all you financial types that, either understand, or work in the credit and financial profession can help me.

The wife and I are looking to buy a home. Apparently the only thing affecting how much we can borrow is the lease on our two vehicles. My van is the more expensive of the two. The plan was to use it for work but my job now provides a vehicle. I have the option on my lease agreement to be able to have a third party assume the lease pending approval from the financial company. My question being that if I do so would it lower my credit rating? It would not be benifical to me at this stage if my rating was lowered but freeing up the extra money would help a lot. thanks

#2 of 3 OFFLINE   Jim Sentry

Jim Sentry

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Posted August 24 2006 - 11:38 AM

You need to be sure the debt is completely removed from your name not that just another responsible party has been added.

#3 of 3 OFFLINE   Shawn Solar

Shawn Solar

    Supporting Actor

  • 767 posts
  • Join Date: May 12 2001

Posted August 24 2006 - 12:09 PM

Hello Jim,

Yes, as I understand thus far I have to get a release letter from the financial company (Nissan Canada). Apparently, in most leases there is a clause stating that the original party is not released from the agreement and becomes a co-signer. In the last two years and because of some court cases this clause can not really be enforced. I guess some companies are even taken it off the agreement. Although the clause is in my lease. Is there a specific type of letter or receipt I need to be removed from responsibility?