Guide: Car Leasing for Young Drivers

Guide: Car Leasing for Young Drivers

Revving engines, open motorways, and the exhilarating sense of freedom – for many young drivers, the allure of hitting the road is undeniable. However, soaring insurance costs and limited budgets means owning a car outright might seem out for reach for many young drivers.

Fear not though, there’s an attractive alternative that's gained popularity over the years – car leasing. In this comprehensive blog, we'll explore the world of car leasing specifically tailored to young drivers. We’ll answer some of your common questions as a young driver looking to lease.

What is car leasing and how does it work?

Car leasing is, in essence, a long-term rental agreement that provides exclusive use of a car for a set period at a fixed monthly rate. This approach to car usage lets you avoid any unexpected depreciation costs by offering a set monthly payment for the term of the agreed lease. Several funding methods are available, each with their own pros and cons.

When you choose car leasing, you tend to make a small initial payment, usually equivalent to three monthly installments, at the start of the lease. Subsequently, a fixed monthly payment is made throughout the agreed-upon lease term. You will have an agreed annual mileage allowance for the lease to meet your needs (Excess mileage charges will apply if you exceed the contract mileage.) At the end of the lease (typically two or three years), you simply hand the car back. It's worth mentioning that certain financing methods (not all) may provide the option to purchase the car at the end of the agreement, subject to a fee known as a balloon payment, should you desire to keep the vehicle.

Can young drivers lease a car?

Yes, young drivers can lease a car. Car leasing is not restricted solely to experienced drivers or those of a certain age group. However, to be eligible for a car lease agreement, you must be 18 years or older and possess a valid UK driver's license. Individuals under 18 years of age can’t lease a car as a lease agreement involves credit, and legally, young persons cannot be held accountable for contracts.

Can I lease a car with a provisional driving licence?

In most cases, leasing a car with only a provisional driving license is not possible. To lease a vehicle with us, it is essential to possess a full and valid UK driving license. Once you have passed your driving test and gained a fully driving licence, feel free to contact us again and we’d be happy to assist you.

Would my parent be able to take out a lease agreement for me?

Taking out a lease agreement on behalf of another individual, also known as accommodation finance, is strictly prohibited by finance providers. This includes scenarios where a parent, friend, or any other person attempts to lease a car for a young driver. Accommodation finance is prohibited by finance companies due to the increased risk of potential contract breaches. It’s important to note that misrepresenting the primary driver during the application process is unlawful and considered fraud.

Can I lease a car if my credit history is limited?

Leasing a car with a limited credit history can be more challenging, but it's not impossible. As part of the leasing process, it is necessary to undergo a credit check as this helps to determine your reliability as a borrower.

Ideally, it's advisable to hold off on applying for a car lease until you've established a credit score. To begin building your credit, start by ensuring you're registered on the electoral roll, as this aids creditors in verifying your identity and address. Additionally, open a bank account and manage it responsibly, showcasing your financial reliability and contributing to a positive credit history. After maintaining your bank account for a period, you might become eligible for a credit card from the same bank. Utilise it regularly, but make sure to settle the balance on time and in full each month. This practice will gradually build your credit history and enhance your credit score.

Would my lease contract include insurance?

Our car lease agreements do not include insurance, and so it’s your responsibility to sort out your own insurance for the vehicle. The insurance policy must be fully comprehensive and should feature your name, the vehicle's registration number, and be dated on or before the delivery date of the car. For young drivers, car insurance stands as a paramount cost consideration. The premiums can significantly impact the overall expenses of driving a car. Before deciding on your lease car, it’s worth researching the insurance rates for the cars you are considering. Generally, smaller, less powerful cars tend to have lower insurance premiums. Keep reading to find out more about some of the best cars for new and young drivers. 

Mileage Allowance For Young Drivers

The annual mileage you select with a lease agreement plays a significant role in determining the overall cost of leasing a car. However, as a new driver, you may be unsure what mileage allowance to choose due to your limited driving history.

In our experience, many drivers opt for an annual mileage between 8,000 to 12,000 miles. However, individuals who use their vehicle infrequently might opt for a lower annual mileage such as 5,000 miles. When deciding your mileage allowance, a practical approach involves considering your anticipated monthly mileage and multiplying it by 12. It's essential to factor in any seasonal variations in your driving behaviour to make a more accurate estimation. It's crucial to select an annual mileage that best suits your needs as it helps avoid incurring excess mileage charges.

Which car should I choose as a young driver?

As a young driver, choosing the right car is an important decision. The ideal car for you will depend on several factors, including your budget, driving experience, lifestyle, and preferences. Here are a few tips to help you make a decision:

  • Affordability: Consider both the upfront cost and ongoing expenses such as insurance, fuel and maintenance. Choose a vehicle that fits comfortably within your realistic budget.

  • Reliability: Choose a car from a reputable manufacturer known for producing reliable vehicles. This will reduce the likelihood of frequent breakdowns and repair expenses.

  • Size and Type: Consider your typical driving needs. Do you need a compact car for city driving, or do you require more space? Also, think about whether you prefer a saloon, hatchback, SUV, or another type of vehicle.

  • Fuel Efficiency: Fuel costs can add up over time, so choose a car with good fuel efficiency to save money and reduce environmental impact.

Some popular choices for young drivers often include small hatchbacks, such as the Peugeot 108, Toyota Yaris, Kia Picanto, or Volkswagen Polo. These cars are typically economical, easy to drive, and have good safety ratings. Click here for more information. 

Is leasing a car a good option for young drivers?

Car leasing can be a good option for some young drivers, although its suitability depends on individual circumstances. Here are some of the main advantages of leasing for young drivers:

  • Lease payments are often more affordable compared to loan payments for purchasing a new vehicle, which can be especially appealing to budget-conscious young drivers.

  • Leasing provides the opportunity to regularly drive a new car equipped with the latest features and technology. This is particularly attractive to young drivers seeking access to cutting-edge safety and entertainment innovations.

  • All vehicles come with a full UK manufacturer's warranty, with the warranty's duration varying depending on the manufacturer.

  • New cars are exempt from the MOT requirement until they are 3 years old. Given that all the vehicles we offer are brand new, it's highly probable that by the time the MOT becomes due, you will have returned the car to the finance company.

Contact GB Vehicle Leasing Today

So, are you ready to lease a new car? Whether you're looking to cruise around town or embark on exciting road trips, start your car leasing journey today. If you have additional questions about vehicle leasing, feel free to contact GB Vehicle Leasing today for more information. We understand that leasing a vehicle often raises several questions, especially if you're a new or young driver, and our leasing experts are here to offer the answers you require. Also, check out our cheap car lease deals, including some cars available under £200 per month. Don't miss out on the chance to drive your ideal lease car without breaking the bank.

We hope you’ve found this blog useful and informative. For additional guides and news relating to cars, connect with us on Facebook.

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