Lease payments must be considered as recurring monthly debt obligations regardless of the number of months remaining on the lease. This is because the expiration of a lease agreement for an automobile typically leads to either a new lease agreement, the buyout of the existing lease, or the purchase of a new vehicle.
Related Article Title: Fannie Mae-Car Lease Obligation: If a client chooses to pay off a car lease, do we need to count the debt in the ratios? Answer: If you want to avoid adding the debt into ratios, your client would have to buy the car outright. They can have no financing whatsoever, not a lease, […]