Many students in the UK want to buy a car to facilitate mobility and improve their quality of life during their study years. However, not everyone has the financial resources to buy a new or used vehicle right away. That’s where student car finance comes in, a viable option that allows students to purchase a vehicle and pay for it in installments over time. In this article, we’ll explore the best student finance options available, the requirements for obtaining them, and the top financial institutions that offer these options.
Best Car Finance Options for Students
New Car Finance
For students who prefer a new vehicle, many car manufacturers and dealers offer student-specific finance plans. These plans often involve a low initial deposit and affordable monthly payments, making them attractive to students. In addition, they can include extra benefits such as maintenance and extended warranties.
Used Car Financing
For students who want a used car, there are several financing options available. Banks, finance companies and car dealerships often offer loans for the purchase of used cars, in which the value of the vehicle is paid in installments over an agreed period. This can be an interesting option for students looking for a more affordable vehicle.
Requirements for Obtaining Student Car Finance
While specific requirements may vary between financial institutions, there are some common criteria that students generally need to meet to obtain car finance. Some of the typical requirements include:
Minimum age
Most financial institutions require a student to be at least 18 years old to qualify for car finance.
Income or Ability to Pay
Students must demonstrate that they have sufficient regular income to cover monthly mortgage payments. This could include income from internships, part-time jobs or scholarships.
Credit History
While students may have limited or no credit history, some lenders may ask for references or look for other ways to assess your ability to pay before approving your loan.
Collateral or guarantor
In some cases, students may need to provide an additional guarantee or guarantor in order to obtain funding. This may be necessary if the student does not have an established credit history or if the financial institution considers that there is a greater risk involved.
Financial Institutions Offering Car Finance for Students
There are several financial institutions in the UK that offer car finance for students. Some of the popular banks and finance companies include:
Barclays
Barclays offers student car finance options for both new and used vehicles. They have agreements with car dealers across the country and can help students find the best financing options.
Santander: Santander also offers student car finance, with flexible plans and competitive rates. They partner with a number of higher education institutions to provide bespoke financing solutions for students.
Black Horse
Black Horse is a car finance company that works closely with car dealers across the UK. They offer student finance options for both new and used vehicles.
Importantly, it is always recommended to compare the available options, read the terms and conditions carefully and seek financial advice if necessary before making any financing decisions.
Final considerations
UK student car finance provides a valuable opportunity for students to purchase a vehicle and improve their mobility during their study years. With the financing options available, students can choose between new and used vehicles, depending on their preferences and financial needs. However, it is essential to understand the requirements needed to qualify for finance and carefully consider the options offered by financial institutions before making a decision. With the right information and proper planning, students can find a suitable financing solution to fulfill their dream of owning a car while at university or college.