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New and Young Drivers Leasing FAQs


Whether you have recently passed your driving test or you have a few years of driving experience, having your own car provides you with the independence and freedom you need.

However, you might not be able to afford to purchase outright the dream car that you have your eye on, and that doesn't leave you with many options.

You could purchase a cheaper and older car, but this comes with a high risk of breakdowns and expensive repair costs.  Another option might be to share a family car, but you may not be able to use it as and when you want to.

Alternatively, you could choose to lease a car.

Leasing a car is a great way to avoid the negatives of the above options. Our guide will answer what car leasing is, how it works, who is eligible and many other questions.

If you need any advice or help, please give us a call on 02392 245570, and one of our friendly, helpful and professional leasing consultants will be pleased to help you.


What is personal contract leasing?

A Personal Contract Hire agreement allows you to drive a new or nearly-new car for an agreed term, typically between two to four years. This duration is known as a 'lease period'. Although the car is actually in your possession, you do not own it.

You pay an upfront payment, which is typically between three to six months' worth of rental payments. If you don't have much savings to fall back on, you can pay as little as only one month's rental fee upfront. You then have to make monthly fixed payments for the time period that you selected until the contract expires. At the end of the agreement, the car is returned to the finance provider.

Many people find leasing appealing as it gives you cost-effective access to new vehicles without the significant drop in value generally associated with owning a new car outright. As you don't own the leased vehicle, you can walk away without any extra obligations once your contract is finished.

What are the benefits of personal contract hire?

Road tax, breakdown cover and free delivery are included in your Personal Contract Hire agreement.

However, there are several other benefits as to why you should lease a car instead of purchasing one outright. Please view our video for more information.

Can I lease a car as a young driver?

You can apply for a vehicle leasing agreement if you are 18 or over and have a full UK driving licence. You will also need to have a good to excellent credit score to be accepted for your finance application to lease a vehicle.

If you have any questions regarding the best way to finance your new car, please call our team on 02392 245570, and they will be happy to advise you on all the options available.

I have little or no credit history, will the finance provider accept my finance application?


To lease a car or van with Fleet UK, you will need to submit a finance application. Most of our finance providers will want you to have a good to excellent credit score to accept your finance application.

The main issue for many young drivers is that they have little or no credit history, making it tricky to obtain finance. This is because finance providers prefer lending to established borrowers to assess better the risk of paying back debt.

That said, the acceptance criteria vary from provider to provider, and a  decision on an application is not based solely on credit rating. For example, some finance providers may accept individuals with lower credit ratings if they can prove that they can afford to pay the monthly payments and the initial payment/deposit. Others may limit the pool of options available by removing more premium manufacturers.

Here are some suggestions for how you can build a good credit score:

  • Open and manage a bank account: Setting up and using a UK current account will help you build your credit history providing you run it responsibly (e.g. making sure you have enough money in your account to cover your payments each month) because it will demonstrate that you can have a responsible, ongoing relationship with a bank
  • Don’t miss payments: It’s vital to ensure you pay all your bills on time to make you more trustworthy, whereas missing payments will count against you. Also, if a company has to take you to court to retrieve the money, then a county court judgement (CCJ) will affect your ability to get credit and will remain on your credit file for six years
  • Set up some direct debits: Not only might you get discounts for paying bills by direct debit, but it will help you avoid missing any payments. You could set up direct debits for bills such as your mobile phone
  • Register on the electoral roll: Being registered to vote in the UK means finance providers can check that you live at the address that you say you do
  • Limit the number of credit applications: every time you make a financial application it is added and stored in your credit file, regardless of whether you were accepted or rejected. While the status of your application is not stored, i.e. it will not say whether your application was successful, numerous applications can give the wrong impression

If you have any questions or concerns, please call us on 02392 245570, and one of our account managers will be happy to assist you.

Can I use a guarantor if I fail finance?

On rare occasions, some finance providers allow you to apply for finance with a guarantor who becomes responsible for paying the finance should you fail to make payments. Usually, a guarantor will need to be a family member and have a solid personal credit history.

Can a parent take out the finance agreement on my behalf?

The simple answer is no. ‘Accommodation Finance’ is where another person looks to take out a lease agreement on behalf of someone else.

For example, this could include a parent looking to take out a lease for their son or daughter. While ‘Accommodation Finance’ is not illegal, it is strictly forbidden by finance providers as they are concerned they might not be able to retrieve the money they lent if there was a contract breach.

Also, not declaring that the person taking out the lease is not the primary driver is illegal and both parties involved (the person applying for the finance and the person they were taking out the lease for) could be charged with fraud.

What is the minimum and maximum leasing contract I can take out?

The minimum term for a Personal Contract Hire leasing term is 12 months although it’s more common for customers to take out a leasing term between 2 to 4 years.

The maximum length of a contract is 5 years.

What is the initial rental fee?

When you lease a car, the finance company generally requires an upfront payment. This is known as an initial rental payment, or sometimes a deposit - but you don't get the money back, as it contributes towards the overall lease payment.

Usually, the bigger the initial rental you pay upfront, the lower your monthly instalments are. It depends on your preferences and budget, but most people prefer to do this. The initial rental fee can be the equivalent of 3, 6 or 9 months of rental payments. The minimum amount is one month with a maximum initial rental payment of 12 months.

The initial rental fee is taken by direct debit payment, as it’s classed as your first payment. For example, a 36-month contract could be a 1-month initial rental payment, followed by a further 35 payments.

When is the processing fee payable?

The processing fee is the broker fee charged by Fleet UK for our service. It represents the costs incurred for arranging the sale, ordering the vehicle, arranging the finance and organising delivery of the car.

Our processing fee is currently £234 inc VAT, payable by debit or credit card or by BACs payment once the finance provider has approved your application for vehicle finance.

However, if you're aged 18-21 years old, you can take advantage of our 'Help 4 Young Drivers' scheme, which wavers the £234 fee and helps you to lease your first car.  Just quote the name of this scheme to the leasing consultant you speak with.


What is the leasing process?

Once you’ve decided that Personal Contract Hire is right for you, you will need to choose your car and the lease terms, including contract length (between 2 to 4 years), annual mileage allowance, and the initial rental fee.


How long is the lease length?

With Personal Contract Hire, the length of the lease contract tends to be between 2 to 4 years.

If you need to end the lease earlier than the contracted time, you must request an early termination. The exact amount of an early termination charge depends on several factors, including how long is left on your lease and the vehicle's value at the time.


As a new driver, what mileage should I choose?

Mileage plays a vital role in your lease agreement, and during the leasing process, you will be asked to choose an annual mileage cap. The mileage cap helps determine the cost of your lease and is used to evaluate your vehicle on its return.

The higher the mileage cap, the more expensive your contract will be and if you exceed your limit, you will be charged potentially expensive excess fees. So, by being honest with your mileage, you are making sure you choose the cap that’s right for you, reducing the likelihood that you exceed your cap.

We tend to see most drivers choosing an annual mileage of 8,000 or 10,000 miles. However, some motorists who only use their vehicle for mainly short trips or occasional use tend to choose mileage of 6,000 miles per year.

A good idea is to try and work out as best as you can how many miles you anticipate you might drive each month. Think about the regular journeys you might make to college, university, work, see friends and family, etc and work out the mileage for each of those journeys.  Work out how often you’ll make those journeys each month, and then multiply your ‘best guess monthly mileage’ by 12 to give yourself an approximate annual mileage.

It’s best to not underestimate the annual mileage as this could result in being charged for excess mileage. Although, there is a possibility your finance provider will allow you to increase the mileage allowance during your contract for a fee. Please see our excess mileage guide for further info.



Is leasing right for me?

As a young driver, you might not have much money to spend upfront on a vehicle unless the bank of mum and dad can help out. This is where leasing is an excellent alternative to buying a vehicle. More young and new drivers are choosing to lease as opposed to buying a car because:

· They get to drive a new or nearly-new car which is fitted with the latest safety and in-car technology
· Road tax is included
· You don’t have the worry of the vehicle depreciating
· There’s no hassle of having to sell a vehicle – at the end of the contract, you just return it
· You don’t have to worry about MOT’s until the vehicle is older than three years
· You have the flexibility to change your vehicle every 2 to 4 years
· The manufacturer’s warranty is included
· You can also take out an optional maintenance contract to cover the costs of servicing, replacement tyres, repairs etc
· Fleet UK can deliver your vehicle for free to anywhere in mainland UK

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I’m under 18 years old, can I lease a car?

Unfortunately, our finance providers do not allow drivers under 18 to apply for lease agreements. This is because vehicle leasing agreements are a type of credit, and a person under the age of 18 is considered a young person and cannot be legally held to a contract.

However, once you are 18 years old, have a full UK driving licence, afford the monthly payments, and have a good credit score, you can apply for a lease agreement.

Can I lease a vehicle with a provisional licence?

Unfortunately, our finance providers will only accept credit applications from drivers who hold a full UK driving licence.

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Can I part-exchange my current vehicle?

If you want to sell an existing vehicle to help fund your initial rental payment, please complete our part-exchange form so that we can provide you with a competitive quote for your car.


Can I add a private registration plate to my leased car?

You would need to request written permission from the finance provider in order to add a private number plate to your leased vehicle. If you have any further questions on the process, give our team a call on 02392 245570.


Can I end my lease contract early?

Because Personal Contract Hire leasing agreements are not meant to be broken, there can be expensive early-termination penalty fees. 

Before you proceed, check what the costs would be from the financial provider and whether they will also accept your contract being ended early.  Please note that early termination is at the discretion of the finance provider and not Fleet UK.


Why is choosing an approved provider important?

Fleet UK are both FCA and BVRLA approved, which means you’re dealing with a reliable provider. Because we’re FCA regulated, you can take our FCA registered number of 682714 and check our status on the Financial Services Register.

The FCA is an important organisation because they work to protect consumer interests, maintain the integrity of the financial system and promote effective competition in the interests of consumers. All of which results in an improved and more reliable service for customers.

Leasing a vehicle through a BVRLA approved company is essential.  The BVRLA is an independent body responsible for ensuring vehicle leasing companies are accountable and provide excellent service to customers.

The BVRLA ensures that any customer who leases a vehicle short or long-term has the protection that comes with choosing a BVRLA approved broker.