A lease refusal often arrives without explanation, in a two-line letter or email. It is frustrating, but it is not a mystery. Before signing, the leasing company always checks the same things: your budget, the credit databases, your debt enforcement record, your employment, your residence status and the vehicle itself. This article helps you work out what may have blocked your application, and what can actually change before you apply again.
A refusal is not a judgement, it is a calculation
In Switzerland, leasing a private vehicle falls under the federal law on consumer credit. This law requires the leasing company to assess your ability to pay before signing. If it signs without carrying out this assessment properly, the company risks losing some or all of what it is owed.
Each leasing company then adds its own internal rules: risk scoring, types of vehicles financed, maximum duration, required down payment. Two companies can therefore give different answers to the same application.
The reasons for a refusal are rarely given in detail. The company does not have to share its calculation with you. However, the information it looks at is known, and most of it can be checked on your side.
The affordability assessment: what the law requires
The principle is simple. Your lease payments must not eat into the portion of your income that cannot be seized. This portion is based on the subsistence minimum used in debt enforcement, and the standards for it are set at cantonal level. The result therefore varies by canton and by household composition.
In practice, the leasing company starts from your net income and deducts:
- the basic subsistence minimum, depending on your family situation
- your rent or mortgage costs
- taxes, estimated or actual
- health insurance premiums
- maintenance payments you make
- monthly payments on existing loans and leases
What is left must cover the lease payment. If a few dozen francs are missing, the application does not go through. The principle behind this threshold is set by law. The amount depends on your canton, your situation and the safety margin the leasing company adds.
One point often comes as a surprise: taxes count. A comfortable income with high taxes or tax arrears can leave less room than a more modest income.
Before choosing a vehicle, start by calculating the monthly payment your budget can handle. You will then start from a realistic figure, not from a model.
IKO and ZEK: two databases, two roles
These two abbreviations come up in almost every refusal. They do not refer to the same thing.
IKO, the centre set up by law
IKO is the consumer credit information centre provided for by law. Lenders report the leases and consumer loans they grant to it. Only lenders subject to the law can consult it, as part of the affordability assessment.
Its role is to prevent over-indebtedness: a leasing company can see the commitments you have already made elsewhere, even if you do not mention them.
ZEK, the private database of credit institutions
ZEK is a private association set up by banks, leasing companies and card issuers. In addition to contracts, it records payment incidents: significant arrears, contracts terminated for non-payment, blocked cards. Only its members can consult it.
Requesting your own report
You have the right to know what these databases hold about you. Both IKO and ZEK accept information requests from the person concerned, usually with a copy of an identity document. Check their websites for the current procedure.
This step is worth taking after a refusal. An error, a paid-off loan still showing as open or an incident attributed to the wrong person can be enough to block an application. An inaccurate entry can be the subject of a correction request.
As for how long entries are kept, it depends on the database and the type of entry. Ask IKO or ZEK directly rather than relying on a figure you read elsewhere.
Debt enforcement, existing loans, employment: what weighs
Apart from their effect on the affordability calculation, none of these points leads to an automatic refusal. Each one is part of the overall assessment, with a weight that depends on the leasing company.
The debt enforcement register extract
Most leasing companies ask for a recent extract from the debt enforcement register, available from the debt enforcement office where you live. An ongoing debt enforcement procedure, even for a small amount, raises questions. An old one that has been paid weighs less, but may still appear on the extract depending on its date.
If an unjustified entry appears, ask the office about the options for having it withdrawn or hidden from third parties. Do this before you apply again.
An existing loan or lease
A small consumer loan, another lease or a card with a large outstanding balance directly reduces the amount available in the affordability calculation. Sometimes a loan of a few thousand francs is what causes a much larger lease to fail.
Employment and income stability
The leasing company looks at how stable your income is as much as how high it is. Some situations call for more documents or more caution:
- a probation period still running
- variable income, with commissions or bonuses
- recent self-employment, with no annual accounts to show
- a fixed-term contract that ends before the lease does
These are not prohibitions, but points the leasing company must be able to document.
Residence permit and domicile
A lease often runs for three to five years. The leasing company wants to know whether you will still be here, reachable and solvent, until the end of the contract.
That is why the type of permit and the length of residence are part of the assessment. A B permit, a C permit or G cross-border commuter status do not give the leasing company the same visibility. For a cross-border commuter, there is also the question of domicile and debt recovery abroad.
The law sets no rule on this point. Each leasing company applies its own conditions, and they can change. If your status worries you, ask before choosing a vehicle, not after the refusal.
The vehicle can also lead to a refusal
People tend to think first about their own situation. Yet the chosen vehicle alone can be enough to make the application fail.
- Age and mileage: some leasing companies do not offer leasing beyond a certain age or mileage at the end of the contract. The limits vary from one company to another.
- Price relative to income: even if the monthly payment fits, a very expensive vehicle compared with your income can look unbalanced.
- Residual value: it depends on what the leasing company expects to recover at the end of the contract. For a model that loses value quickly, the residual value used goes down and the monthly payment goes up.
If a vehicle is not suitable for leasing, a standard loan or paying in cash are still possible. A loan also goes through an affordability assessment, often a stricter one. To compare these options properly, read our article on choosing between cash, a loan or leasing for a used car.
Before you apply again
Submitting the same application elsewhere the next day rarely gives a different result. If the problem comes from the affordability calculation or from a database entry, another leasing company will see it too. Sending more applications does not solve an underlying problem.
These are the levers that actually change the calculation:
- A larger down payment: it reduces the amount financed, and therefore the monthly payment.
- A longer duration: the monthly payment goes down, within the limit the leasing company accepts for that vehicle.
- A less expensive vehicle: this is often the most effective lever. Browse the vehicles currently for sale with your target monthly payment in mind.
- A small loan paid off: repaying an existing loan frees up room in the calculation.
- A corrected error in your ZEK report or in the debt enforcement register.
- The end of your probation period: waiting a few weeks may be enough.
Taking over a lease, another route
There is another option: taking over someone else's lease. You step into an existing contract, often with no down payment and for a shorter period. The leasing company must still give its approval and assess your situation. So it is not a way to avoid having your application reviewed.
If you already have a lease that is too heavy
Sometimes the refusal comes from an existing lease that takes up all the available room. Before looking for a second contract, check what ending a lease early costs. Depending on the settlement figure, getting out early is not always better than seeing the lease through: the article sets out both options. If handing the lease over to someone else appeals to you, see how we list your lease for takeover.
Getting support
After a refusal, what you mostly need is a better-prepared application. Before applying again, ask yourself three questions: what monthly payment your budget can really handle, which vehicle matches that payment, and which documents show that your situation is stable.
At SwissMcars, we can review your situation with you, point you towards a realistic vehicle and monthly payment, and then support you through the financing application. We cannot guarantee the leasing company's decision: that decision is theirs. What we can do is help you avoid submitting an application that had no chance.
Start by simulating your monthly payment on the leasing page, then have your situation reviewed before you apply.
