Is There A Minimum Age To Lease A Car?

The minimum age to lease a car is 18 years old, but there’s no upper age limit as to who can choose leasing to get a vehicle. This is because finance providers look for some form of credit history in order to carry out the credit check needed to be approved for a lease deal.

Read on to discover tips for first-time leases and what documents you’ll need to get behind the wheel of your new vehicle.

Why do I have to be 18 or over to lease a car?

young person driving

The minimum age restriction when it comes to who can and can’t take out a lease agreement is there primarily because of the information needed to approve each application.

Although you can legally drive a car once you’ve turned 17, you won’t be able to apply for the finance needed for a car lease until you’re 18. The reason for this is that the funder will ask for credit information which will require you to have incomings and outgoings, including any direct debits and monthly earnings. Plus, by law you can’t have a finance contract if you’re under 18.

Because under 18s tend to have no/very little credit profile, it’s almost impossible for a finance provider to tell whether or not the monthly payments can be afforded.

Here’s what a funder looks at during a standard credit check for a lease agreement:

  • Credit score – “good” to “excellent” scores are considered by providers, which takes time to build up by making scheduled payments on time and using a credit card little and often, for example.
  • Income and expense – what existing direct debits/standing orders are being paid and any regular payments/earnings into your account.
  • Employment – this tends to be for the past 2-3 years which can be difficult to ascertain for someone who’s under 18 and has little job history.
  • Bank details – used to check how you manage the account which you intend to use to fund the car you wish to lease.

Remember: If you’re under 18, many leasing providers will see you as a young person and therefore won’t be able to legally hold you to a finance contract. Once you turn 21, however, they will then see you as an adult, meaning you can easily be approved for the finance.

Can someone lease a car on my behalf?

Unfortunately, ‘accomodation finance’ (e.g. a parent taking out a lease agreement on behalf of a son/daughter) isn’t entertained by leasing providers.

Even when it’s done legally and the person taking out the finance isn’t named as the main driver, there’s still a big risk that the funder won’t be paid in full or see that the car is returned.

What do I need to lease a car?

If you are 18 or over and want to lease your next car, there are certain documents and information which you’ll need in addition to the finance information mentioned above.

For business leasing (lower monthly payments but the car must be used for work purposes) there’s separate requirements that you’ll need to meet.

Personal leasing

  • Personal details – e.g. number of financial dependants.
  • Address details – usually this is for the past five years.
  • Bank statements and/or utility documents – this is used as proof of address and/or shows a regular income.

Business leasing

  • Details of the company – including the name, full address and registration number.
  • Director’s information – e.g. if there’s more than one director, their names, marital statuses and birth dates.
  • Bank details – this will be for the company’s account and is used to show how the business’ finances are managed to ensure that the monthly payments can be met.
  • If the company is less than 12 months old or has been declined finance before then other information may be needed, such as:
    • Business bank statements for three months.
    • A guarantee from a company director that they will be liable for any outstanding finance if the business defaults on payments.
    • A business financial report/cash flow. 

To learn more about business car leasing, check out our business guide which explains what this type of vehicle hire contract involves.

Is leasing a car right for me?

car credit

There are many benefits of leasing a car for new and young drivers, including:

  1. A brand-new model for low monthly payments.
  2. No large upfront payment needed for the car – an initial payment equivalent to one month of the lease price can be put towards the vehicle.
  3. No commitment to owning the car at the end of the contract – you can hand the keys back at the end and walk away.
  4. Optional maintenance for wear and tear plus regular servicing which can be included within the cost of the car.
  5. Building your credit score by showing lenders that you can honour the monthly payments for the car.

While these can be great perks for new and young drivers looking for a quick, affordable way to get behind the wheel of a new car, it’s important to make sure that leasing is right for you.

You can do this by asking yourself some of the following questions before jumping straight into a contract.

Can I afford the monthly payments?

There are great bargains out there when it comes to car leasing, with deals for less than £200 per month available. However, it’s only a bargain if you can afford to commit to paying these installments for as long as your contract term, be that two, three or four years long.

So, when it comes to configuring your deal, be sure to calculate how much spare cash you have after any other bills, mortgage payments and other direct debits have been paid.

If you’re left with very little once the lease car payments come out, then it may be worth looking at an alternative method to getting your next car. Otherwise, you can incur large fines and even have the car repossessed by the finance provider for missing payments.

How much can I put towards the initial rental?

Every lease agreement begins with an initial rental which is non-refundable but works against the overall cost of your agreement. So, the more you pay towards the car initially, the less you’ll pay each month for the remainder of your contract.

Just like the monthly payments, it’s important to consider what you’ve saved up and can afford to pay for the initial rental beforehand.

Remember: The initial rental will affect what you pay each month for a lease car, so be sure to check that you can afford both the upfront and remaining costs prior to committing to a lease agreement.

Is insurance affordable?

Contrary to what some people believe, most car lease agreements don’t include insurance, unless you take out an inclusive package, which will usually be called ‘Total Care’ or ‘Complete Care’.

In this instance you’ll be responsible for arranging and paying for a fully comprehensive policy for the car in order to protect the asset (the vehicle) which the funder owns and has leased to you.

It’s difficult to predict exactly how much insurance will cost for a car you wish to lease before you sign a contract and have the car’s details. However, you can still get an accurate quote using the make and model of the car, when it will be registered and your personal details and driving history.

Insurance comparison websites such as MoneySuperMarket, Confused.com, GoCompare and CompareTheMarket allow you to do this very quickly. Plus, it means that you can prepare financially for this motoring cost aside from your monthly rentals (if it’s not included already).

For more information on how best to insure a lease car, check out our guide to car leasing with insurance.

Can I maintain the car?

As we mentioned earlier, you can decide whether or not you want to add maintenance cover for a car you’ve leased at the negotiation stage.

Usually this will cost around £20-£25 extra each month, but means that you can have the car serviced at any time for wear and tear issues not caused by driver error. Also included in this price is an MOT test, but only if your contract term means that the vehicle needs one (e.g. a four-year contract or longer).

Alternatively, you can keep the car in good condition yourself by keeping on top of regular maintenance. This includes having it cleaned every 2-3 weeks, ensuring you have the right tyre pressure in all four tyres based on the vehicle’s laden weight, and topping up engine oil, coolant and windscreen washer levels when needed.

If you can afford to do either of these two things, then you can avoid having to pay potential excess damage charges at the end of your contract.
You can find out what condition the car should be in at the end of a lease, plus what actions you should take if you damage your lease car in our other guides.

Does my annual mileage justify getting a lease?

For those of you who didn’t know, leasing a car involves declaring how many miles you intend to drive it each year. And, because the monthly rentals are based on depreciation of the vehicle for the time that you have it, the annual mileage cap has a big impact on what you will pay each month for the car.

You’ll often find that you can specify that you want to drive anywhere between 8,000-30,000 miles each year (this renews every year you have the car).

Despite these options catering to most drivers, there’s inevitably going to be cases whereby people either drive upwards of 30,000 miles or don’t use the car often enough to get close to 8,000 miles.

Either way, this can mean that you’ll be charged for excess mileage for going over your cap (fees are between 4p and 70p per mile), which can soon add up and be expensive. Otherwise, you could be paying monthly for a car which is barely being used, potentially causing maintenance problems (especially for diesel models which require regular trips to clear soot from the diesel particulate filter).

Remember: You can amend your annual mileage mid-lease if you think that you’ll go over your agreed total for your contract (i.e. length of your agreement in years multiplied by annual mileage).

Top 5 car lease deals for young drivers*

*Prices accurate from Moneyshake lease deals as of 06/08/2020

1. Vauxhall Corsa – from £131.73pcm

vauxhall corsa 2

Trim: 1.2 SE Premium (five doors).

RRP: £16,700.

Boot space: 309 litres

MPG: 53.3

Key features: 7.0” infotainment system with Apple CarPlay and Android Auto, cruise control, lane assist, driver attention monitor, 16” alloy wheels, heated front seats and steering wheel, rear parking sensors, automatic lights and wipers.

2. Ford Focus – from £190.60pcm

gray-ford-focus-5-door-hatchback

Trim: 1.0 EcoBoost 100 Zetec (five doors).

RRP: £21,000.

Boot space: 273 litres

MPG: 53.3

Key features: 8.0” touchscreen infotainment system with Apple CarPlay and Android Auto, heated windscreen, leather steering wheel and gearknob, front centre armrest and cruise control.

3. Nissan Micra – from £163.21pcm

Nissan Micra

Trim: 1.0 IG-T 100 Visia+ (five doors).

RRP: £14,200

Boot space: 300 litres

MPG: 50.4

Key features: OEM sound system with Bluetooth/USB connection, collision avoidance braking, tyre pressure monitor, lane departure warning, automatic high-beam assist, power assisted steering and a tyre repair kit.

4. Seat Ibiza – from £159pcm

Seat Ibiza Xcellence

Trim: 1.0 SE [EZ] (five doors)

RRP: £16,500

Boot space: 355 litres

MPG: 52.3

Key features: 6.5” touchscreen infotainment display with Apple CarPlay and Android Auto, leather-trimmed steering wheel with integrated controls, speed-sensitive power steering, multi-collision braking, hill hold control, automatic emergency braking, tyre pressure monitor and a comfort suspension.

5. Renault Clio – from £156.80pcm

800px-Renault_Clio_TCe_100_Experience_(V)_–_f_09022020

Trim: 1.0 SCe 75 Play (five doors)

RRP: £14,900

Boot space: 300 litres

MPG: 52.3

Key features: Bluetooth connectivity, cruise control, traffic sign recognition, lane departure warning, tyre pressure monitor, power assisted steering, traction control, exterior chrome Clio styling pack, 16” alloy wheels.

If you’re over 18 with a good credit history and need a new car, then why not lease? Compare prices now for an offer on our special offer lease deals.

Still have questions about leasing? Then head over to our other guides on personal leasing guides.

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