Student
car finance

Can students get car finance?

Here with Carboom, yes, you can! But getting student car finance isn’t always straightforward. The biggest challenges are limited credit history, lower income, and how lenders assess risk. That doesn’t mean it’s impossible—there are ways to find the best car finance for students.

Most students have little or no credit history, which makes it harder for lenders to check if you’re reliable with money. Plus, if your income comes from part-time work, student loans, or family support, it might not meet lender requirements. Since students aren’t in full-time jobs, some lenders see them as higher risk, worrying about whether they’ll manage monthly payments.

The good news? There are car loans for students and other car finance options available, including:

• Hire Purchase (HP) – You spread the total amount payable over fixed monthly instalments, and the car is yours once the last payment is made.
• Personal Contract Purchase (PCP) – You get lower monthly repayments and can choose at the end whether to buy, return, or upgrade the car.
• Guarantor Car Finance – If someone (like a parent) with a good credit score agrees to step in if needed, it improves your approval chances.

The two types of car finance for students

At Carboom, we offer two main types of student car finance to help young drivers in the UK find a loan that works for their budget. Both options let you spread the cost of the car through monthly payments, but they work in slightly different ways.

Hire purchase for student car finance

If you’re looking for student car finance that lets you own the car at the end, Hire Purchase (HP) could be the right choice. It’s simple—you spread the total cost of the car over fixed monthly repayments until it’s fully paid off.

Here’s how HP finance works:

• You may need to pay an initial deposit, which can lower your monthly payments, but it’s not always required.
• The remaining amount payable is split into fixed monthly instalments over an agreed term.
• At the end, there’s a small “option to purchase” fee, and once paid, the car is officially yours.

Since the monthly payments are fixed, it’s easier to budget and plan ahead. If you’re ready to explore car finance options for students, Carboom can help you find the best deal.

Personal contract purchase for student car finance

If you want lower monthly payments and more flexibility at the end of your agreement, Personal Contract Purchase (PCP) could be a great choice. Unlike Hire Purchase (HP), you’re not paying off the full cost of the car—just part of it. This helps keep monthly repayments lower.

When your PCP finance agreement ends, you have three options:

• Keep the car by making a final payment, called the Guaranteed Future Value (GFV).
• Return the car without extra costs, as long as you’ve stayed within the agreed mileage and kept it in good condition.
• Upgrade to a newer car by starting a new PCP deal.

PCP is ideal if you like changing cars more often or want smaller monthly payments. If you’d like to explore your options, Carboom can help you find the best deal.

Student car finance with a guarantor

If you’re struggling to get student car finance because of a low credit score or limited income, a guarantor could help. This gives lenders more confidence, making it easier for you to get approved for a car loan.

Even if you’ve been refused car finance before, adding a guarantor could improve your chances. Since lenders see a guarantor finance deal as lower risk, you might also get better interest rates or a lower total amount payable. Your guarantor doesn’t have to be family, but they do need a good credit score and a stable income.

This is a great option if you have bad credit or no credit history. If you’re ready to explore your car finance options, Carboom can help you find the best student car finance deals.

Student car finance with bad credit

If you have bad credit or no credit history, you might think getting student car finance is impossible—but that’s not true. Some lenders specialise in helping students, focusing on your current financial situation rather than past mistakes. As long as you can show you can afford the monthly payments, you still have options.

At Carboom, we work with lenders who consider affordability over credit scores. Plus, our soft search application lets you check your chances of approval without impacting your credit score. This means you can explore car finance deals for students without any risk.

Even if you've been refused car finance before, you might still be eligible for student car financing through one of our specialist lenders. If you're ready to see what's available, Carboom can help you find the best car finance options for your budget.

What to think about before getting a car finance as a student

Student car finance isn’t just about getting a car—it’s about choosing one that’s safe, efficient, and affordable. Instead of struggling to buy an older, unreliable car outright, finance lets you spread the total cost and get something better suited to your needs. Here’s why this can be a smart choice:

• Newer cars are more fuel-efficient, helping you save on petrol or diesel costs.
• Insurance can be cheaper, as modern cars often have better safety features.
• Fewer unexpected repairs, since newer vehicles are generally more reliable.

At Carboom, we work with a panel of lenders to help students find the best car finance deals, tailored to their budget. Our process is simple and hassle-free, so you can focus on choosing the right car for your needs.

How to improve your chances of getting student car finance

At Carboom, we understand that getting student car finance can feel challenging, especially if you have no credit history or a low credit score. But don’t worry—there are ways to improve your chances, and we’re here to help. Lenders mainly look at whether you can afford the monthly payments and manage money responsibly. Here’s how to boost your approval chances:

1. Show proof of income

Even as a student, having a regular income can make a big difference. Lenders want to see that you can afford your monthly repayments, so if you have a part-time job, be sure to include this in your application. You can also list any student loan or family financial support as part of your income. The more stable your income, the better your chances of securing a car finance deal for students.

2. Plan your budget

Before applying for a car loan for student uk residents, it’s important to know what you can realistically afford. Think about:

• Monthly payments – Make sure they fit within your budget.
• Running costs – Factor in fuel, insurance, road tax, and maintenance.
• Deposit amount – A larger deposit can help lower your monthly repayments.

Lenders will see you as more responsible if you have a clear budget plan, making it easier to get approved for car finance options for students.

3. Improve your credit score

Your credit score plays a big role in whether you’re approved and what interest rates you’re offered. If your score is low or non-existent, you can improve it by:

• Paying bills on time – Even a mobile phone contract can help build your credit history.
• Registering on the electoral roll – This makes it easier for lenders to confirm your identity.
• Avoiding multiple credit applications at once – Too many applications can harm your credit score.

Even small improvements can make a big difference when applying for car finance as a student.

4. Use a guarantor

If you have bad credit or no credit history, a guarantor can increase your chances of approval. A guarantor is usually a parent, family member, or close friend with a good credit score who agrees to cover your monthly payments if needed. This reassures lenders and may even help you secure a better finance deal with a lower interest rate.

What is a good first car for a 19-year-old?

Choosing your first car is exciting, but it’s also a big decision. The best first car for a 19-year-old should be affordable, reliable, and fuel-efficient, with low insurance costs to help keep expenses down.

• Ford Fiesta (1.0 EcoBoost) – A fun, reliable car that’s cheap to run, but sportier models may have higher insurance rates.
• Vauxhall Corsa (1.2 Petrol) – Affordable, easy to drive, and cheap to maintain. Older models may have fewer features.
• Volkswagen Polo (1.0 TSI) – Well-built with strong safety features, though it can be slightly more expensive than other options.
• Toyota Aygo (1.0 VVT-i) – Extremely fuel-efficient and low-cost insurance, making it ideal for student car finance deals. Boot space is small, though.
• Hyundai i10 (1.0 MPi) – Compact, reliable, and cheap to insure, though it’s not the most powerful option.

If you’re considering car finance for students, it’s important to choose a finance deal that fits your budget. Carboom works with a panel of lenders to help students find the best car finance deals.

How to get car finance as a student

At Carboom, we make getting car finance as a student simple and stress-free. You don’t need to be a finance expert—we’re here to guide you through the process from start to finish. Here’s how it works:

1. Apply online

Fill out a quick online form with some basic details about yourself, your income, and the type of car you’re looking for. We’ll run a soft credit check, which won’t affect your credit score, but helps us find the right finance options for you.

2. Get your finance offers

Once we’ve checked your eligibility, we’ll show you student car finance deals from our panel of lenders. You’ll see different options with details on monthly payments, interest rates, and total cost, so you can choose what works best for your budget.

3. Choose your car

Once you’ve picked a finance deal, it’s time to choose your car! You can buy from a trusted dealer, and we’ll help make sure everything is covered.

4. Finalise the agreement

Before the finance is fully approved, there will be a hard credit check—this is a standard step and may affect your credit score slightly. If all looks good, you’ll review and sign your finance agreement.

5. Drive away!

Once the paperwork is sorted, the lender sends the funds directly to the seller, and the car is yours!