Hippo Leasing helps younger drivers get into new and used lease vehicles every single day. Over the decade that we have been in operation, we have noticed that there are a number of questions that younger drivers have and we have gathered them all here, along with the answers of course, in order to help you select the finance and car that is right for you.
The Key Questions young drivers ask
What type of finance should I go for as a younger driver? What type of car is best for me? Should I lease a new or used car? Once I decide on the type, what is the best make and model for me? What extras should I consider like GAP Insurance or Warranties? What car insurance should I go for?
These are some of the many questions that we get asked by younger drivers. Let’s look at each one in more detail.
What type of finance is best for me?
We have a much more detailed answer to this question which can be found here but in essence, there are 3 main types of personal car finance, namely: Personal Contract Purchase (PCP),Personal Contract Hire (PCH) and Hire Purchase (HP).
PCP is the most flexible type of finance and very popular with younger drivers as you have the choice of either handing back the car at the end of the agreed payment period or, by paying a “balloon payment”, you get to keep the car.
PCP has a lot going for it. It’s slightly harder to get than say Hire Purchase finance so very young, first-time buyers may struggle a bit more than ones with a more established credit history, but Hippo have thousands of PCP deals on new and used cars for you to consider.
PCH is the purest form of leasing – there is no option to buy the car at the end of the agreement but this suits many younger drivers just fine! We see an increase in younger drivers looking for this type of finance though PCP is still the most popular.
HP is the most traditional form of finance – you borrow an agreed amount over an agreed term, pay the same amount every month and, in the end, the car is yours. HP is a good option for those younger drivers who know that they want to keep their car at the end of the car finance agreement. It’s also a good option for those younger drivers who know that they are going to do a lot of mileage as there is no excess mileage charge to worry about when you take a car on Hire Purchase finance.
What type of car is best for me?
This is obviously a question that relates to needs, personal taste and, sometimes, that hard to define “feeling” that a car gives you. In order to answer this question, its often best to ask yourself a series of smaller questions which then help to narrow down the thousands of cars and vans that Hippo Leasing have to offer. Ask yourself the following:
What is most important to me? Is it economy, size, safety, practicality, status or reliability and what is the priority of my needs?
If it's economy, you will be looking at the miles per gallon that the vehicle gets and also considering hybrid and electric vehicles.
Size is often a key consideration. If you live in an inner city, you may want a small, nippy vehicle that does not attract much tax and is easy to park. Likewise, if you have a growing family, the prospect of a 2 door car or the kids squashed in the back may drive you towards the ever popular medium and large SUV’s or to a multi-purpose vehicle.
Safety is often a key factor when buying a car, especially if mum and dad are contributing to the deposit and a car with a very good NCAP rating might be a major factor.
Practicality takes centre stage when you are looking for a good all-rounder that can do multiple things, for example, a vehicle that you can drive lots of miles in but still be able to potter around at the weekend or a vehicle you can use for work during the week or as a people carrier for the weekend or holidays.
Status is all about feeling good about the car. Many car buyers want to feel special when driving their car and, why not! In this case, you will probably be looking at high-end German makes (obviously BMW, Audi, Mercedes and some VW’s) with a few non-German options like Jaguar, Land Rover, Volvo and Lexus.
Reliability is also a key factor for most but the fact is that modern cars tend to be very reliable. If you are particularly concerned by reliability, you may wish to look at cars with long manufacturer warranties, some that stretch to as much as 7 years from new.
Should I lease a new or used car?
Most dealers have very fixed ideas about this. New car dealerships would rather you purchased a brand new car as this is how their business models (and manufacturer commissions) are structured. Used car dealers often don’t have access to new cars so they would obviously push used cars. We believe that you should have whatever car suits your requirements!
New lease cars have the benefit of a brand new manufacturers warranty, no MOT costs for 3 years and are likely to have all the new mod cons where vehicle manufacturers are increasingly introducing new beneficial features and benefits as part of the cars base package – Hippo has thousands and thousands of new car and van lease deals available
A nearly new car still has that “new car smell” but you can benefit for a reduced price which in turn translates into lower monthly lease payments.
In years gone by used cars were a real gamble but with the increase in cars general reliability and the ability to add stand-alone warranties to manufacturer warranties you can have the best of both worlds. Hippo have over a thousand nearly new and used cars available for you to purchase using a lease arrangement or alternatively a traditional hire purchase agreement – we genuinely don’t mind if you prefer a nearly new or used vehicle!
What make and model car should I go for?
When it gets down to choosing a car make and model, there are so many choices that this can create confusion and doubt, especially for young drivers that don’t necessarily have much experience with all of the different car makes.
This is where a good car provider or dealer shows their worth. Firstly, they should have a very wide choice so that you know that they are providing vehicles that are suitable for your needs and not just which particular car or cars they want to sell. Think about the needs discussed above and put your dealership to the test. Ask them to select 3 or so potential options based on your needs.
If they have the choice and the knowledge, then this should be second nature to them. At Hippo, we have over 40 dedicated, knowledgeable and helpful account managers who are all trained in the different forms of finance and also extensive knowledge on all the types, makes and models of vehicles available. We are here to help you with the finance and the car so you are never on your own.
What car extras should I consider?
When you buy or lease a new car you can expect the salesperson to present you with a whole lot of extras from insurance policies through to car treatments. Before you go for a stand-alone warranty – particularly for a used car – you should check how long the manufacturer’s warranty still lasts. A reputable company will point this out so you don’t incur unnecessary expense. GAP (Guaranteed Asset Protection) policies are also a consideration and can be very useful if you have an accident and need to replace your vehicle where, for example, a Return to invoice car GAP insurance policy will allow you to replace the vehicle with one that was similar to the one you originally leased or bought. If you are buying a Prestige car and intend to keep it for some time then a ceramic paint protector may well be worth the money. Again, you will want a dealer or provider that finds out what your needs are so that any add ons are relevant to you. At Hippo we have straight forward extended warranty, Gap and paint protect deals should they be right for you.
What car insurance should I go for?
Car insurance is a particularly competitive field. Many car insurance companies and underwriters struggle to make a profit but still, their profit margins tend to be relatively small. That is why we don’t offer car insurance ourselves as we would simply be one more link in the chain to earn a commission and thus raise the cost of insurance for you. Instead, we encourage you to shop around and use comparison sites to get the best level of insurance at the best price. Younger drivers often get ridiculously high quotes from car insurance companies where they tend to pay more because of a minority of young drivers that are not responsible drivers and at the end of the day, experience also counts when it comes to avoiding accidents. We have a more in-depth article on car insurance for younger drivers here but in essence, you can look to reduce the cost of insurance by:
Buying or leasing a less expensive car - normally one with a slightly older model year
Buying or leasing a “low powered” car without stellar 0-62 miles per hour times
Buy or lease a car with good NCAP ratings
A car with inexpensive parts and low labour costs to fix
A car with good security features or add a good and accredited alarm
There are also a number of things that you can do to reduce the costs:
Add a more experienced/older driver to your car policy
Reduce your level of cover - for some, third party fire and theft may be enough
Add a telematics/black box to the car which records how you drive your car
Ensure you have off-street parking for the car
By paying annually you can normally reduce the cost of insurance
Lastly, and particularly if you are a new, young driver you should look to shop around every year – as your experience and (hopefully) your no claims bonus grows so will your insurance premiums reduce over time and you only pay the least amount possible for the same cover.
Being a younger driver has its challenges, but there is no reason why you cannot get the car of your dreams and keep the costs down if you plan ahead and have a good dealer or car provider on your side.
Hippo Leasing provides thousands of new, nearly new and used cars to all types of customers including younger drivers. We have a massive selection of real cars and vans which means we are independent and can offer you the best deal on the car and with our huge panel of lenders, the best finance deal to match. Call us today on 01254 956666 or simply email us at email@example.com.