Alizeh is a car finance specialist at ChooseMyCar with a focus on clear, jargon-free advice. Her expert guides are designed to help UK drivers understand their options, from PCP deals to managing monthly budgets, so they can finance their next car with confidence.
If you’re looking for a new car, some circumstances can be difficult to navigate. While this one might be rare, it does occur. So let’s set your mind at ease with how you can get around it: the problem of financing a car without a license.
To some readers, this may seem strange. Surely there’s no way someone without a valid driving licence can finance a car? But the truth is, you can, and many people do for reasons such as buying a family car for a partner or preparing for when they pass their driving test. In fact, with around 80% of new cars in the UK bought on finance, most through PCP agreements, it’s not unusual for the registered keeper not to be the driver themselves.
The legalities of financing a car
When you finance a car, you can choose from a variety of purchase plans, the most popular of which are PCP (Personal Contract Purchase), HP (Hire Purchase), and increasingly, Lease/Subscription models.
PCP Agreement: Your monthly repayments are slightly lower because there is a balloon payment due at the end of your agreement in order to own the car. You don’t have to make this final payment; you can instead return the car to the manufacturer and take out another PCP financial plan. If you do this, you never own the car, but you are the registered keeper.
HP Agreement (Hire Purchase): Monthly repayments are higher because there is no balloon payment at the end. You own the car outright once payments are completed, making you the legal owner and registered keeper.
Leasing/Car Subscriptions: A growing trend in the UK and Europe is subscription-based car finance. Instead of buying, you “rent” the car on a long-term lease. This often includes maintenance, servicing, and sometimes insurance, making it attractive for those without a license but planning ahead for when they pass.
But how can you finance a car in any of these circumstances without a license? Well, that’s because financing a car doesn’t mean you have to be the registered keeper or the person who drives the car. A financial agreement for a car does not mean you own the car or that you will be the person driving it.
This separation between “financing” and “driving” is often misunderstood. In practice, as long as you can prove identity and pass affordability checks, you can secure a finance deal.
Can you finance a car without a license?
As we’ve explained, the short answer is yes. However, this doesn’t mean you won’t face some difficulties. Ultimately, the decision is down to the car manufacturer or finance provider.
Having a license may not be an issue, but the bigger challenge is affordability and your credit profile. If you’re a young driver without a full driving license, it’s fair to assume that you don’t have a long credit history either. This could prevent some car manufacturers from approving your finance application. In fact, around 1 in 5 car finance applications in the UK are rejected due to poor credit history or affordability concerns.
Bad credit car finance without a license
One of the most common barriers is not just having no license, but also having poor credit. According to UK Finance reports, around 1 in 5 car finance applications are rejected due to credit score issues.
If you fall into this category:
- Consider specialist lenders: Some finance companies focus specifically on bad credit car finance.
- Build your credit: Using credit responsibly on smaller agreements (like a phone contract or credit card) improves your score over time.
- Expect higher interest rates: Bad credit car finance can mean APRs of 20%+, compared to the market average of 9.9%–12%.
- Look at cheaper vehicles first: Starting with a more affordable car can increase your likelihood of approval.
Even if you don’t have a license, applying with a joint applicant (such as a parent, spouse, or guarantor) can significantly improve your chances of approval.
Market trends: Financing a car without a license
While it may sound unusual, the practice is growing. With the rise of multi-car households and car subscriptions, more people finance cars for someone else in their family. For example:
- Parents financing cars for children preparing for their test.
- Partners financing cars jointly where one doesn’t yet drive.
- Businesses financing pool cars where the main signer is not the driver.
The scale of the market reinforces this: in March 2025 alone, around 240,000 cars were financed in the UK, totaling £5.15 billion in loans, an 18% increase year-on-year.
How to get a car on finance without a license
Can you get a car finance deal without a license? Yes. But it’s important to set your expectations at the right level. This is a financial agreement after all, and it’s safe to assume that because you’re looking to enter a financial agreement, you don’t have the money to put down a huge deposit or buy a car outright.
Here are some steps to improve your chances:
- Know Your Budget: If you’re in full-time work, calculate a safe monthly repayment. Experts recommend keeping car finance below 15% of your net monthly income.
- Check Your Credit Score: Many free tools let you check this before applying, helping you target lenders more effectively.
- Choose Affordable Brands: Opt for reliable used cars (Ford, Vauxhall, Toyota) instead of premium brands initially.
- Consider a Guarantor: A co-signer with a strong credit history can unlock better deals.
- Shop Around: Use brokers or comparison platforms rather than applying to a single dealership.
Remember: Financing a car without a license is more about financial responsibility than driving ability. If you can afford it, you can usually have it.
Who can be the registered keeper if you don’t have a licence?
One of the most common points of confusion around car finance is the role of the registered keeper. This is especially relevant if you are financing a car without a driving licence.
The registered keeper is the person responsible for the vehicle in day to day terms. That includes things like tax, MOT reminders, parking fines and correspondence from the DVLA. The registered keeper does not have to be the person who financed the car, and they do not have to be the person who drives it.
For example, you might finance a car in your own name but register it to a partner who will be driving it. Or a parent may finance a car and register it to a child who has already passed their test. As long as the finance provider is aware of the arrangement and the details are accurate, this is generally acceptable.
What matters most to lenders is that the finance agreement is affordable and that responsibilities are clear. The driving licence itself is not the deciding factor here.
What documents do you need to finance a car without a licence?
Even without a driving licence, finance providers will still need to verify your identity and financial situation before approving an application.
In most cases, you can expect to be asked for documents including:
- Proof of identity, such as a valid passport.
- Proof of address, like a recent utility bill or bank statement.
- Proof of income, usually recent payslips or bank statements.
- Your bank details for setting up repayments.
A driving licence can sometimes be used as photo ID, but it is not essential. If you do not have one, a passport is usually more than sufficient. The focus is on confirming who you are and whether the repayments are realistic for your income.
Frequently asked questions
Can you finance a car before passing your driving test?
Yes. Many people arrange car finance in advance so a vehicle is ready once they pass. Approval is based on affordability, not driving status.
Can students finance a car without a licence?
It is possible, but approval can be more challenging due to income and credit history. A guarantor or joint applicant can improve the chances.
Will finance companies automatically reject you without a licence?
No. Most lenders do not require a driving licence as a condition of finance, as long as identity and affordability checks are met.
Can you collect a car if you do not drive?
Yes. Collection can be done by someone else, or delivery can be arranged, provided the dealer and finance company are informed.
Does not having a licence delay the finance process?
Not usually. As long as the correct documents are provided, applications without a licence are assessed in the same way as any other.
Finance companies care more about affordability than your driving status. As long as repayments are realistic for your income, approval is still possible even without a license.
