You’ve done it, you’ve finally passed your test. After months of driving lessons, you’ve
learned your theory and negotiated your driving test. Now you just need to put everything
you’ve learned to use, and for that, you’ll need to get your own car.
For young drivers, this can sometimes be easier said than done.
As a young driver, it can be hard to find the right car. Having to juggle the need to keep it
reliable, safe, cheap to insure, aesthetically pleasing and affordable to run can be a difficult
task. Adding the reluctance that some lenders or dealers have with allowing young drivers
car finance deals can make it particularly difficult for them to get hold of their first car.
Buying a used car can often be the best way to make car ownership a reality for young drivers. Using car finance for a used car can make it even more affordable. Being able to pay off the cost of a car in small monthly installments can make it manageable. Once lenders have checked to make sure that you are able to meet the payments, you’ll be good to get a young driver car finance deal. Used car finance is the best choice for many, not just young drivers, as it’s a great way to keep costs down.
Hire Purchase and Personal Contract Purchase for Young Drivers
Hire purchase (HP) and personal contract purchase (PCP) agreements are the most popular forms of car finance. Both will include making monthly repayments and usually a deposit. In some instances, however, there may be no-deposit or else a very small one.
Hire Purchase Agreements for Young Drivers
This will divide the cost of your car into monthly repayments. At the end of the term, the car will be yours, but you don't own the car outright until then. If you go over your mileage allowance you could be charged more. Find out more about hire purchase agreements for young drivers here.
Personal Contract Purchase Agreements for Young Drivers
As you don’t automatically own your car outright at the end, monthly costs can be lower. You do have the chance to pay a balloon payment at the end of your term though. For more information on Personal Contract Purchase agreements for young drivers visit our PCP page.
Using Guarantors for Young Drivers Car Finance
As many young drivers haven’t spent time building up their credit score or may be studying
or working part-time, being able to prove that you can meet monthly repayments could be
tricky. Using a guarantor for car finance can help reassure lenders that your payments will
be covered. A guarantor will be able to help you by covering any payments that you may
miss, so if you have a bad month for shifts, or something else gets in the way, you’ll never
miss a payment.
In many cases, the guarantor won’t need to be called upon at all, other than for the
paperwork at the beginning of the agreement but, if the worst does happen and for some
reason you can’t make a payment, they’ll be able to step in and stop that from happening.
Your guarantor must be over 21 and have a good credit score. Usually a guarantor would be
a parent. Someone like your spouse, who is linked to you financially, is automatically ruled
It’s important to note that if both you and your guarantor miss a repayment then both of your credit scores will be negatively affected and, in some circumstances, you can both be taken to court.
Car Finance for 17-year-olds
Unfortunately, it’s almost impossible to get a car on finance when you’re 17. Most lenders won’t consider lending to someone under the age of 18, for a number of reasons. At this age, you’ll likely have to make do with any savings you have or else the generosity of others, such as a gift or loan from a parent.
Car Finance for 18-21-Year-Olds
Once you turn 18 things look a little rosier. While your credit score is still likely to be low,
lenders are more likely to look kindly on your situation.
While we’d still recommend spending time building up your credit score, there’s still a good chance that a lender will give you a car finance deal as long as you can prove that you can make the monthly payments. This means either having a job or potentially a guarantor as discussed previously.
Understanding Car Finance as a Young Driver
There’s a lot to learn about car finance and we have a whole host of extra content for you to sink your teeth into. If you simply want to see what you can afford, then go to our car finance calculator or apply now for the best deals on car finance.