Helping a friend out so this is out of my scope of expertise.
West Coast CA/NV.
Light credit history: $8k Wells Fargo CC (4 years) $1k Amex (3 months)
Experian: 728 (not auto fico, unknown)
Female, age 24. First time buyer.
Income: $2k a month
Prefer EV if possible, but open. 4 door, nav, basic packaging.
A) Can this customer get approved for a tier 1 lease?
B) Ideas for particular cars/brands to be looking at?
So many may not agree with this car, but for a data point Toyota has a national program on the Corolla for $279 down $279 a month plus taxes and fees for a 36/10 lease on the LE model.
They also offer $500 rebate for recent college grads. You could probably do slightly better if you grind some dealers. I think you might have a good chance of approval of a recent grad since they offer this rebate.
I offer this suggestion based on recent grad and income. It gets great mileage and is simple and cheap to maintain and should be problem free for the 3 years. As a recent grad, I would not want to get strapped by a new car.
Why does this person want or need to lease versus buy? Simply to keep the cost down? $400 a month for 60 months buys a vehicle in the $20K range. You should look at both options so your friend builds some equity over time. A 2024 Corolla fits into this category and will likely hold its value pretty well.
Helping my friend would consist of advising her to buy something with cash, or finance (reasonably). Considering a lease at over 25% of gross is on the wilder side, especially for the circumstances here.
Finance a Honda, Toyota, Nissan or Mazda.
I second this - although a 24 Corolla may be too expensive for her.
Get into a cheap used reliable vehicle.
Finance to build a payment history and work hard to improve income.
PS: not being judgmental, but getting into student debt to make 2k/month is wild…
The problem is reliable, affordable used cars dont really exist as they used to. For example, on CarMax ands Carvana, you are paying 75% of MSRP for a 2017 Corolla with 100K miles. That is a reliable car but even for a Corolla the chance of a serious mechanical issue exists is signifcant once you get over 100K miles.
if your budget is $5K, you are stuck with a 10 year old Nissan Versa. But if you can swing a new base Corolla (or Hyundai Venue) you are going to do much better in total cost of ownership as well as risk mitigation with basically no chance of an uncovered catastrophic mechanical issue shortly after purchase. Alternatively, the absolute cheapest Hyundai or Nissan lease might also not be a bad option at $300 a month
Assuming she is interning in entertainment industry or some related field. A full time worker in California earning minimum wage would earn almost $3,000 a month.
Income $2K a month and she wants to spend $400 on a car lease? That’s insane. Add in gas and insurance and you’re talking 30-40% of income spent on a car.
At that income level, you take the bus. If you absolutely do need a car, buy a 12 year old Corolla or something. Even at 100K miles those are very reliable.
In many areas of So Cal, taking a bus is not really an option.
Just a few brief off topics…
I don’t see OP mentioning that friend had student debt, just that they were a (new) college grad.
The entertainment industry (referring to film/TV) in CA (well, at least Los Angeles) has been decimated, from what I understand,. That’s had a huge (and devastating) impact on our restaurant industry (which I kind of follow).
To get back onto the topic, I think Elantras have (had?) been leasing relatively well. OP, you or your friend might want to look at the pre-negotiated deals (“PND”) section to get a sense of what might be leasing well in her budget right now.
I agree that stretching a bit for a brand-new car carries many advantages over buying a very old, used car.
That’s why I’m not judging this specific situation, but weighting on the fact that people might go into debt to get that kind of pay afterwards.
As mentioned, it could be just the internship allowance.
An older Corolla with the 1.8 and not the 2.4
Even older ES330 can be found for 5k without crazy miles. One of Toyota’s most durable powertrains ever.
Lives at home, no rent. Drove a versa until it blew up. Wants reliable and no headaches with repair worries. Mother will be putting down the drive offs as a gift. Doesnt have enough cash to pay $15k-20k for a used car outright. No student loan debt.
A Subaru Solterra could be had for less than $300/mo $3K DAS
CA/NV as in Tahoe? “West Coast CA/NV” covers a lot of ground and maybe AWD is needed?
I can do a Camry se under 400 with some nice options.
Feel free to text. They get like 50mpg also which would save a lot in cali
Jim
215-359-6836
no awd required
2026 Mercedes gla250 with decent options (MSRP $45k+). You can get one with 24m/12k under $300 inc CA taxes with less than $2k DAS. Good luck.