What is Progressive Leasing and How Does it Work?


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If you need to make a large purchase but don’t have great credit, you may need financing. If you are denied credit from a regular lender, what do you do?

There is another option that many people don’t know about, progressive leasing financing.

Progressive leasing is a type of installment financing that allows you to lease an item for an extended period without having to make large up-front payments. This may be what you need if you are not able-bodied and cannot work or your credit score has been damaged due to circumstances beyond your control. Progressive leasing offers “no money down” financing, which means you do not have to pay anything upfront when the contract is signed. Instead, the monthly installments will cover what would have been paid as a down payment with traditional leases. This is a great payment option if you often get debit card declined notifications.

If this sounds like a solution to what you need, read on to see what you need to know about progressive leasing financing.

What is Progressive Leasing Financing?

Progressive Finance is a firm that provides web-based lease-to-own financing solutions for customers and businesses. The company currently services more than 2,000 merchants in the United States and Canada. It has been in operation as an alternative means to finance big-ticket household items for over 20 years.

What Does Progressive Leasing Finance?

You can finance many things through a progressive leasing agreement, including appliances, furniture, jewelry, and electronics. The interest rates are usually much lower than what you would receive with traditional financing for similar items, and you can get what you need without troubling your credit score.

what does progressive leasing finance
You can finance electronics, jewelry, furniture, appliances and more with progressive leasing

Some of the largest retailers in the United States use progressive leasing to finance what their customers need.

How Does Progressive Leasing Work?

Many retailers offer Progressive leasing programs that allow customers to lease an item for typically twelve months with no down payment required. This is usually a program that retailers utilize after a customer has been denied credit from a department store credit card. The customer is referred to progressive leasing to obtain what they were looking for from the department store.

Progressive Leasing Payment Options

When it comes to the progressive leasing payment options, you have a few options. The standard lease agreement offered to consumers is what is called a deferred payment plan. This means that you will make monthly payments for what is initially agreed upon as the lease agreement term, usually twelve months. This means that after twelve months, you own the merchandise free and clear.

Additional Progressive Leasing Payment Terms

  • After you receive your products, your recurring auto-payment schedule will begin on the next scheduled payday.
  • If the first payday isn’t at least ten days after delivery, Progressive leasing will postpone it until the following payday.
  • You do have the option to pay the lease off before the initial twelve-month term, but you will incur a purchase option charge. This means that if your monthly payment isn’t enough to cover what you owe, the difference will be divided by what would have been your remaining payments and added as a purchase option charge.
  • Generally, the merchandise you are buying costs more than what you are paying per month, which is why many people choose this type of financing through progressive leasing.

Financing your purchase through progressive leasing does have a few advantages. Not only is it an excellent option for buy now pay later no credit check instant approval no money down purchases, but there are also flexible payment terms. Progressive leasing can withdraw payment amounts directly from your bank account monthly or every other week. This is helpful for individuals who get paid weekly or practice the budget by paycheck method.

Does Progressive Financing Have Interest?

No, progressive leasing is what’s known as a purchase option. You are purchasing the merchandise in question upfront and allowing them to take payments over time. They offer a 90-day purchase option (3-month purchase option in CA) as part of the lease you sign.

  • If you can exercise the 90-day (3-month purchase option in CA) lease-to-own purchase option, then your overall payment won’t be that much higher than what it would have been if you had chosen to pay for it upfront. This is the least expensive way to finance your purchase through progressive leasing.

However, if you end up financing your purchase for the entire twelve months, your overall cost will be expensive. There are some reports of consumers who have paid almost double what the original cost was for the product in the store.

Depending on the overall costs of your items, a credit card might be a better option for financing your purchase if you are planning to pay it off between 90-days but less than twelve months. You can calculate the interest yourself. Follow the steps on how to find finance charge with average daily balance method.

Does Progressive Leasing Run Your Credit?

Progressive leasing does run your credit and what is known as a soft credit check. This means they are not reporting what you purchase to the three major credit bureaus, TransUnion, Experian, and Equifax. The purchase will only be seen when you pull your credit report.

If this were a hard hit to your credit report, then what happens is what’s known as a hard inquiry. The credit bureaus will see the company name and what account number was added to your report. A hard inquiry lowers credit scores by what is known as five points.

does progressive leasing run my credit
Progressive leasing runs a soft inquiry on your credit

A soft hit or what’s known as a non-hard inquiry will not report what you purchased to the credit bureaus nor reduce your score. Therefore if you have thin credit or are in credit repair, then what is known as a soft inquiry will be the best option for financing your purchase. Using finance programs that pull hard inquiries can be a great way how to repair your credit yourself even if there is a low APR.

Reasons Progressive Leasing Will Deny Your Application

There can be reasons that your application will be denied. Some reasons that progressive leasing will reject your application are:

  • Too many credit cards
  • No bank account
  • Recent bankruptcy
  • Too many current accounts
  • Recent collections account
  • No established credit history whatsoever
  • If you have too much personal debt in relation to your income

A recent bankruptcy can stay on your credit report, what is known as ten years or what’s known as the time frame of chapter 13 and seven years, what is known as chapter seven. If your proportion of loan balances to loan amounts is too high in relation to your income, then it may be hard for an applicant with thin or what is known as no credit history to get approved.

What Credit Score is Needed For Progressive Leasing?

Progressive leasing does not report what you purchase to the three major credit bureaus. You are not applying for credit in the traditional sense. Therefore, you don’t need a strong credit score to obtain financing from them. Typically a FICO score ranges from 300 to 850, and it’s considered with most credit applicants. What progressive leasing will look at is other data points besides your credit report.

credit score needed for progressive leasing

Most importantly, progressive will consider what’s called your DTI or what’s known as your debt-to-income ratio. That’s what they’re going to look at when you apply for financing from progressive leasing. Many other places will run your credit for example what credit score is needed to buy a car a Carmax instead of using solely DTI ratio.

As a borrower, that means the percentage of your gross income that goes to your monthly payments. If you have a DTI of over 36 percent, what progressive leasing will do is they’ll deny credit at their store, and they won’t issue an approval on financing if the applicant’s DTI exceeds 36%.

Does Progressive Leasing Build Your Credit?

No. Progressive leasing only pulls soft inquiries on what’s called a soft search. Even if you are approved by progressive leasing, your purchase will not be reported to the three major credit bureaus. You won’t build a traditional credit history with progressive leasing because what they do report will not show up on your FICO score or other types of scores. There are no account numbers, payment history, what you purchased, or interest rate; not any of that stuff will show up on what’s called a hard pull.

This is entirely different financing than a no credit check cell phone financing option. In that situation, a hard pull will be done on what’s called a hard search. It will show up on what is known as your FICO score, and it can help build a credit history if you make your payments in full every month from that type of program.

Snap Finance vs. Progressive Leasing

There are two large lease-to-own merchandise financing companies. The other one is called snap finance. Snap finance is what most people think of when they hear about no credit check type financing programs. Some of the snap finance highlights are below:

Snap Finance Highlights:

  • 12-18 month merchandise financing period with a long payment plan
  • 100-Day payoff option
  • Applicants not reported to the three major credit bureaus
  • Maximum lease agreements of $3,000
  • Applicants must apply and be approved for Snap Finance before purchases are made

Progressive Leasing Highlights:

  • 12-month merchandise financing period with a short payment plan
  • 90-Day payoff option
  • Applicants are not reported to the three major credit bureaus

Both of these programs are what are known as deferred billing. With this type of financing, what that means is you don’t have to pay the full amount right now. You can stretch out what’s called a cash price or what would be an in-store purchase.

It allows consumers who may not get approved from other types of leasing programs such as snap finance and others; progressive leasing can work with what is known as sub-prime or what’s considered high risk.

Alternatives to Progressive Lease to Own Purchase Program

Most in-store finance programs are for credit applicants. There are alternative financing programs that don’t require a credit check, and they offer low-interest rates. Progressive leasing is so popular because it does not impact your FICO score or what the three major bureaus know about you when you apply for this type of program.

Set Up a Budget

If you know you have a large purchase coming up but don’t want to use a lease-to-own financing program, you can use a personal budgeting method instead. By using this process, you can take a portion of your paychecks and save that amount from going towards your purchase.

You can set up an automatic transfer of your paycheck to a dedicated savings account. If you follow this method, know bank direct deposit times to know when your money is available.

Pay with a Check

If you have money on hand in the bank, you can pay electronically. There are a lot of online shopping sites that accept pay with an eCheck that will transfer the money with ease.

If you have questions on this option, be sure to check out what is an eCheck for details.

Pay Cash with Instant Check Cashing

There are options if you don’t have a bank account but have checks that will cover your purchase. You can use instant online check cashing options as a way to get the cash and pay for your purchase immediately.

Some check cashing apps are what are known as paycheck advance apps. These are considered payday loans, but they have lower interest rates since you can use your next paycheck for repayment of the loan. There are also check cashing apps that don’t use INGO as well.

Withdraw Cash Money Order Style

Some people will withdraw cash from their bank accounts and then take that money along with a pre-paid debit card to pay for what they need. If you have a checking account, this can work. If you don’t, you will want to get a money order near me, which most merchants and check cashers use when accepting cash payments.

Income Tax Return

If you have a large tax refund or what is known as back pay, that’s another option. You can use your income tax return towards what you need to purchase and put the rest in savings for now. If it isn’t enough, consider adjusting your withholding on your paychecks.

Related Questions:

Can you buy video games with progressive leasing?

Yes, you can buy video games, electronics, and what are known as big-ticket items with progressive leasing. You must first apply for the program before making any purchases. There is also a 90-day payoff option if you want to pay off what you have already financed at the store.

What are progressive lease payments?

Progressive provides a straightforward lease program that enables you to pay over time. You own the goods after progressive receives your last payment.

Is progressive leasing weekly?

Yes, you can have the payment withdrawn from what is known as a checking or savings account weekly. There are options for what’s called monthly payments available too.

What are the requirements for progressive leasing?

You must be 18 years of age or what is known as the legal minimum to sign up for progressive leasing. You must have an active checking account and what is called a valid social security number too. If you don’t, what happens is that progressive will ask you to get what’s known as a Taxpayer Identification Number before starting any lease agreement with them.

Conclusion

If you need to buy a mattresses, jewelry, video games, furniture, appliances, and more, progressive leasing installment financing is what you need. Using progressive leasing is a way to finance what you need now with easy monthly payments stretched out over 12 months.

There are many advantages to lease-to-own programs, such as progressive leasing, as you can see from above. If you have what is known as bad credit, finding the right kind of what is called leasing to own programs can be easy if you know where to look. You can apply online and get approved in a few minutes or through a store.

The best part is that you always have the option of early pay if within 90-days of purchase. By following this path, you will avoid paying hefty charges that may be assessed at the end of your 12-month lease-to-own agreement.

BG Vance

For over 20 years, BG Vance has been a leader in public and personal financial management. He's developed and managed public budgets in excess of hundreds of millions of dollars. He is passionate about the FIRE movement and was featured in the Detroit News in 2001 about saving for retirement. Through the years, he's assisted families and individuals with getting their finances on track. He holds an MPA, is a licensed Realtor, and is currently working on a book about personal finance.

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