How might a lease affect my credit scores?

[starting_over30]

Hey all, It's been a long long time since I've posted to this board and thankfully I've matured a bit and have been on a good track record with improving my credit from a previous bankruptcy, and then another car repo years after.  With the last few years of babying my credit and financial choices I've managed to get my scores to 689, 663, and 680 - however I just received an alert than the first 689 score somehow jumped up to 735.  I have no idea why, but I think maybe some old late payments finally dropped off.  I'm hoping the same happens to the other scores!

Anyhoo...I'm looking to buy/lease a car soon.  I'm considering leasing a new Mazda or Honda but have never leased a vehicle before and don't know how this will affect my credit in the long term.  I also currently rent an appartment and my goal is to buy a house next year when my lease is up.  I would really like to get all of my scores into the 700+ range before seriously considering buying a house so I still have work to do on my credit.

So here's my question:  Should I buy or lease my next car?  I'm not sure which would look better on my credit report so I'd like to make the best decision for financing my next vehicle as well as setting myself up for improving my credit to eventually buy a house.  My credit union pre-approved me for a loan last year when I signed up with them, and they report to all 3 bueros so I'd like to go with them, but if leasing gets me a better monthly payment I'd like to consider that route as well.

[Anonymous]

I'm not a car guru, so I'll leave that question to someone else. You did not post your income, so I will say make sure the price range, as far as the house you want, t can handle a DTI with your vehicle payment included. If not, you may be looking at finishing up with the car before the mortgage. Just a thought.

[Appleman]

The long term goal is important to keep an eye on, the home loan. I believe loan or lease will show up as a monthly payment and will factor into your mortgage application in a similar fashion. A mix of credit that includes a car loan or lease can be positive for your application IF your debt to income can handle the payment. If you can find a factory lease with fairly low monthly lease payments that would be my recommendation if you are wanting a new car. 

You may want to talk to a mortgage broker and see if they will give you 5 minutes of their time. Someone who is closing lots of home loans will likely give you the best answer and they of course will want to earn your eventual business. Just a thought....

[6speed8]

Agree with Appleman. I recall my sister (ex-banker) once told me that in some respects, a lease is viewed differently by some lenders when it comes to home loans. With a car loan, you have - or at least working towards - some equity in the vehicle. Example: If you have an $8000 note on a vehicle that's worth $12,000, you have $4,000 in equity. If you you're 18 months into a 36 month lease at $300 a month, that's sort of a $5400 "negative" aspect because you have zero equity and contractually have that $5400 responsibility. Maybe things have changed since she told me that but it's how she explained it to me.