Getting behind the wheel of a car is an exciting milestone for young drivers. Whether it’s a brand-new Ford Fiesta or a second-hand SEAT Ibiza, the sense of freedom that comes with a new car is invigorating. Understandably, many young drivers don’t have the cash to purchase a car outright. This is where car finance for young drivers steps up.
With a strong application, a positive attitude and a good amount of groundwork, you can take advantage of car finance for young drivers and get the keys to your new ride ASAP. Of course, car finance for young drivers does have its challenges. That’s why we’ve put together this guide designed to help you build a strong and attractive application.
Expand your horizons with a large lending panel
When it comes to securing car finance for young drivers, a large lending panel makes a big difference. It’s definitely possible to find car finance as a young driver, but barriers like lack of experience and financial history make it a little harder than usual. Enlisting the help of a broker can be a great way to expand your horizons and expose your application to as many lenders as possible.
One of the first things a broker will assess is eligibility and of course, age is a factor. Can you get car finance at 18? Absolutely. Here’s how a broker can help:
Let a broker do the hard yards
Instead of individually contacting lenders, a broker does all the legwork for you. They have the experience and expertise to match your application with the right lenders and products, thus increasing your chances of success and helping you secure the best interest rates and loan terms on car finance for young drivers.
Contrary to popular belief, many lenders are excited to help young drivers get behind the wheel of their first car. They won’t automatically refuse applications based on age and some even offer products designed especially for young drivers. You just have to know where to look! Once again, this is where a broker comes in.
Brokers are also a fantastic resource as they can help get you up to speed on the different types of car finance for young drivers. There are several different options available in the UK, each with its own unique pros and cons. As a young driver it’s important to understand what you’re signing up for. Brokers can help you navigate the car finance realm and select a product that’s right for you.
Choose an affordable vehicle
Naturally, most lenders will be wary about offering car finance to your drivers eyeing vehicles featuring high-powered V6 engines. Similarly, your chances of securing car finance for young drivers are lower if you’re shopping for a top-of-the-range Jeep 4×4 or luxury model like a Chevrolet Corvette. Even if you have the best intentions, applying for car finance to purchase these sorts of vehicles can imply you’re a high-risk borrower. Keeping your application realistic and down-to-earth will help you win over lenders and find the best car finance deals for young drivers.
Choosing an affordable vehicle not only boosts your chances of being approved for car finance but can also slash the cost of insurance. Most young drivers are hit with big premiums during their first year of driving, with many paying more than £2,000. As a young driver, it’s worth considering models that are cheap to insure. This includes popular cars like the zippy Hyundai i20 and the much-loved Fiat Panda. Want to know more? Don’t miss our roundup of the 10 cheapest cars to insure for young drivers.
Consider ‘black box’ insurance
As well as bringing down your premiums, ‘black box’ car insurance can be a great way to win over lenders. Also known as telematics, this type of insurance policy sees a black box installed in your car. It uses GPS to collect data on your driving behaviours, including things like speed, mileage, braking habits and the time of day you get behind the wheel. This data is used to assess your driving style and calculate a premium, ideally less than the blanket policies offered to other young drivers.
Ultimately, motorists who drive safely and responsibly are rewarded with lower premiums. Black box insurance can also help show lenders you’re committed to being a conscientious, low-risk driver.
Take advantage of young driver incentives
While car finance for young drivers does have its challenges there are also some great perks and incentives out there. Some dealerships offer student-friendly incentives while others attract young drivers with special rebates. You may also be eligible for discounts on your insurance premium, gifts such as retail vouchers and cashback schemes.
Shopping around for these deals can be tricky, which is where a broker can help. They’ll assess your application and match you with lenders who are most likely to approve your loan and ideally, offer you some great perks.
Tips to boost your credit score as a young driver
Lack of financial history is one of the biggest barriers young drivers face when applying for car finance. Below, we cover some quick and easy ways you can build a borrowing history and boost your credit score. In a matter of months, you can drastically improve your chances of securing car finance for young drivers.
- Apply for a low-limit credit card
Many banks offer low-limit credit cards designed with students and young people in mind. Applying for one of these products can be a great way to build your credit history, as long as you use it responsibly and pay off your debt every month.
- Pay off any existing credit card balances
If you already have a credit card with a significant balance, doing everything you can to pay it off is a guaranteed way to improve your credit rating.
- Set up direct debits for bills
Rather than topping up your phone on a pay-as-you-go basis, consider setting up a direct debit. This helps pad out your credit history and shows lenders you’re capable of committing to regular monthly payments.
Car finance made easy for young drivers
Whether you’ve passed first-time in your late teens or you’re a twenty-something ready to upgrade your car, My Car Credit aims to make it easy to find car finance for young drivers from all backgrounds. Ready to get your application rolling? Reach out to our team by email on firstname.lastname@example.org or give us a call on 01246 458 810 to find out more car finance for young drivers.
Representative APR 10.9%
Evolution Funding Ltd T/A My Car Credit
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