Denial letter after leasing a vehicle?

[Anonymous]

Hey y’all

I leased a Toyota at the beginning of the month. My lease is through Toyota Financial Services. Today, I got a letter from a large US Bank saying my application for my lease had been denied (?). Really confused as to what’s going on. All three scores are around or above 800. The letter even gives my trans union score and it’s over 800. Called TransUnion directly to confirm the credit inquiry and it’s legit.

Any had this happen before?

[Miner]

I don't really know how leasing works, but it sounds like they shopped your credit around to more than just Toyota Fiancing.  Each creditor is required to tell you why you were rejected for credit which also gives you are right to a copy of your credit report for free from the CRA they used.  Perhaps they tried to get you approval on a loan to offer you options other then just leasing?  Or they were trying to see if they could get better terms. 

When I bought my vehilce a few months ago I got 2 rejection letters, one a month later and then 2 weeks more the other showed up. 

[Anonymous]

Thanks. I’m wondering if there was just some bad data input somewhere by the dealership.

Anyone else experience something similar?

[Kree]

Did you get under 2% apr?

If so, I could see a financial institute denying a loan, because they don't want to give that apr, instead of because your profile.

EDIT:  is there apr in leases? I actually don't know.  There must be some sort of interest involved or else why would anybank agree to finance them. MAybe its the buyout price that wass objected to.

[Anonymous]

Denial letter's don't necessarily mean you were completely denied. Lender's are required by law to send out AA letter's anytime they deny you credit or do not approve you based on the dealership's requested terms. If the bank countered the requested structure in any way, they are required to send you a letter. For example if the dealership requested 72 mo term and the bank countered at 66 mo's due to vehicle age, they are required to send you a letter.

With scores above 800 I can't see why US Bank would counter/decline you for any reason other than high DTI or a Bankruptcy on your CB. US bank has strict underwriting guideliens in that they will not extend auto credit to anyone with a BK on their CB, even if it's a month from falling off.

These letter's are very typical, and many time's people get confused when the bank that they financed through, send's them a letter a week later stating they were "declined" when in fact, the bank simply countered the dealership's requested terms but still made the counter-offer work.

[Anonymous]

Thanks for the info.

Speaking of DTI....how do auto lenders view a joint mortgage? My wife pays half the mortgage but the monthly payment on a credit report obviously just shows the total payment due. Do they adjust for that? If they don’t, that would obviously give someone a much higher DTI.

[Anonymous]

If you are applying individually (by yourself) and have a mortgage, whether it be joint or not, the full payment is calculated towards your DTI. If you were to split, or she lost her job, you would be soley responsible for making the payment by yourself, which is why an underwriter will calculate DTI off the full amount.

[Anonymous]

That seems a little odd. I understand the logic I suppose, but a co-borrower is legally responsible for the payments as well. If payments are missed, it hits both borrowers credit as well.

Maybe the right way to approach is list “household” income on application?