A young student leaving home for university

Car finance for students

Students and new drivers can get car finance with Zuto. Apply now or find out more.

Zuto is a credit broker, not a lender. Our rates start from 9.9% APR. The rate you are offered will depend on your individual circumstances. Representative Example: Borrowing £7,000 over 48 months with a representative APR of 19.3%, the amount payable would be £205 a month, with a total cost of credit of £2,831 and a total amount payable of £9,831.

Car finance for students and young drivers

Having a driving licence is one of the best freedoms in the world – all you need next is a car.

Zuto can help with car finance for students and young drivers alike. There are some particular challenges – like getting an agreement with bad credit and/or without a deposit – but we can help.

Car finance can be ideal for students who need a car but can’t afford one outright. By spreading the cost over monthly payments, we can help you find a deal you can afford.

The 3 types of car finance for students

The three most popular ways of keeping monthly payments down and spreading the cost are personal loans, Hire Purchase (HP) and Personal Contract Purchase (PCP).

  • Hire Purchase (HP) – you pay for the car’s total value plus interest, in monthly instalments over a period of time, usually one to five years. When the final payment is made, the car is yours. This is the most popular type of finance for used cars.
  • Personal contract purchase (PCP) – similar to HP, but instead of payments based on the car’s value, you pay off its depreciation plus interest each month until the term ends. When you reach the end, you can make a lump sum payment to buy the car outright.
  • Personal loan – you borrow money – for example, from your bank – to buy the car. The car is yours from the beginning.

What to think about

There are some big advantages to getting car finance when you’re a student. It can help you get into a car that’s cheaper to insure, safer and more efficient than what you might be able to afford otherwise.

Fortunately, there are ways to get car finance if you’re a student. Zuto works with lenders that want to help students but there are ways of improving your chances too.

Before you sign up, there are some key things to think about.

The challenges for getting student car finance

  • Paying a deposit – finding the money for an initial large sum to secure a car on finance isn’t easy. However, being able to do so can be your way into affordable monthly payments.
  • Lack of monthly income – many students are unemployed, few have a full-time job as there isn’t time, and part-time jobs bring in limited income.
  • Limited credit history – if you’re a student, you’re unlikely to have had time to build a proper credit profile yet. This can make some lenders wary of offering help.

How to improve your chances of getting student car finance

1. Get a part-time job

A job can show lenders you have a constant, reliable income and can afford monthly repayments.

If you’re a full-time student, even working part-time can bring some income that you can use to make purchases, helping lenders trust you.

If you’re unemployed, our panel of lenders may still be able to offer you a car finance agreement.

2. Know your budget

It’s a great idea to plan your monthly outgoings to work out how much you can afford. Add whatever incomings you have (student loan, part-time work) and subtract your outgoings.

In addition to what you already have in your budget, there are other things you’ll need to consider when you have a car:

  • Road tax – this varies depending on the car type and its CO2 emissions.
  • Insurance – probably the biggest factor is car insurance as it can be expensive depending on your age and driving history.
  • Running costs – think about how often you’ll need fuel and don’t forget servicing and MOT also impact on your wallet.

You can get an initial idea of how much you could borrow with our car finance calculator.

3. Improve your credit score

Your credit score can show a lender how reliable you’ll be with repayments. Usually, the better your credit score, the better interest rates you’ll be offered.

There are some simple ways to improve your credit rating, like registering on the electoral roll, having a mobile phone contract in your name that’s paid on time, and even having a student credit card with a low limit.

If you have bad credit, you can still apply for car finance with us. You can also find out more in our guide, 15 easy ways to improve your credit score.

Car finance calculator

See how much you could borrow

How to get car finance as a student

Our process is the same for every driver – whether you’re a student, a young driver, or someone with an excellent credit history and decades of driving experience. It only takes minutes to get a quote.

We can you help you every step of the way. Contact us for support and advice at any point.

  1. Apply for a quote – we’ll ask you for some personal details to help us get started. We’ll run a ‘soft’ credit check, which won’t appear on your credit history. We’ll then contact our panel of lenders to see if they'll approve your application for finance.
  2. Pick a deal that works for you – we’ll talk you through your options to find the car finance agreement that works for you.
  3. Choose your car – we’re AutoTrader’s car finance partner and work with a group of trusted dealers. When you’ve found your perfect car, we’ll run free vehicle checks for you.
  4. Sign your agreement – the lender will make some final checks, which will include a ‘hard’ credit search.
  5. Start driving – once you and the lender are happy, you’re good to go!

Useful information and guides

  • your-cars

    Find out about different types of car finance

    Our guide to car finance options takes you through the different types in more detail, and will show you how it works.

    Read our guide Arrow Right
  • your-cars

    How to get car finance with a bad credit score

    Students are unlikely to have a long credit history, but you can still get car finance with a poor or bad credit score.

    Read our guide Arrow Right
  • your-cars

    Talk to the Zuto car finance team

    We have a team on hand to help you with all things car finance – from helping you find a deal to choosing your car.

    Contact us Arrow Right

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