CINCINNATI—Lease credit approval rates rose to their highest percentage in 2020 during the recent holiday season.
Swapalease.com, which says it is the nation’s largest car lease marketplace, reports car lease credit applicants registered a 72.7% approval rate in December.
The approval rate is significant considering approval ratings hit a low of 63.8% in April, the lowest rate reported since January of 2018, Swapalease.com said.
“With the holiday season being an optimal time to buy or lease a vehicle, it is no surprise that approval ratings saw an increase in December,” Swapalease.com said. “According to Experian’s State of the Automotive Finance Market Report, in the second quarter of 2020, nearly 26% of new vehicles were leased. While this number is down from pre-pandemic levels, Swapalease.com believes many of its site visitors have solid credentials available to take over a person’s vehicle lease. The inclination to have more flexibility through leasing amidst economic uncertainly may contribute to a rise in shoppers who are looking to lease vehicles.”
Deals Drive Approvals
December has historically turned out a higher lease credit approval rating, likely due to end of year sales and lease deals. In December of 2019, 72% of applicants were approved to take over another person’s lease, and in December of 2018, 71.4% of applicants were approved, the company said.
“The automotive industry took a hard hit in early 2020, especially as stay-at-home mandates were implemented and businesses were temporarily shut down,” said Scot Hall, EVP of operations at Swapalease.com. “We’ve continued to see slight increases month-over-month since May, and we’re optimistic at the outlook for the 2021 calendar year.”