Retired, and think car leasing is inaccessible or not especially tailored towards the elderly population?
Fortunately, that's a misconception which we're here to tell you isn't true. Because in actual fact, car leasing isn't tailored towards any age group, meaning you're just as likely to be offered finance as anyone else.
Let's find out why.
Do Car Lease Agreements Carry an Age Restriction?
Nope. No age restriction at all, yet this is one of the main reasons why older drivers might think they'll be turned down.
At the end of the day, leasing is a credit-based product, not an age-based one.
Okay, But Aren't Pensioners Likely to Have Worse Credit?
Not necessarily.
If you're retired, you might have one or multiple pensions available to you which provide a regular stream of income, so you don't necessarily need to be working in order to be accepted onto a lease deal. What's most important is that you can afford the monthly payments for the deal in question, whether that's from a pension or full or part-time employment.
Also, there's a high chance that you might have been able to build up a good credit score over the years, thereby increasing your likelihood of being accepted.
And speaking of credit score . . .
Will I Pass the Credit Check?
In order to be accepted for a car leasing contract, most credit providers require you to have a good enough credit score and credit history. That's because vehicle lease agreements are credit-based and not age-based, so as long as you have a good credit score and your finances are in order, there should be no issues.
To pass a credit check, you'll first need to confirm your identity, which usually involves providing your full UK driving license and/or other documents. The application will likely also take affordability into account.
To sum up, your overall eligibility will be based on several factors:
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Credit history – Arguably the most important one. Amongst other checks, leasing companies will run a credit history report on potential customers.
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Income and expenditure – This is obviously to ensure that you can actually afford the monthly payments for the lease deal to which you are applying.
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Personal details – Including the number of any co-dependants as well as your martial status, etc.
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Residential history – Leasing companies generally require at least five years' worth of address history from yourself. This could be used to check the credit histories of anyone who is financially connected to you, and also as another means to confirm your identification.
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Employment history – Probably for the past three years. The employment history check can be used to determine what your current income and expenditure is.
What is the Main Difference When Leasing as a Pensioner?
The main potential difference which could affect pensioners is that after the age of 70, a person's driving license has to be renewed every three years. (Pension age for men and women born before 5 April 1960 is currently 66).
So if for any reason your license is not renewed, you'll have to return the lease vehicle and will probably be liable for early termination fees. And remember, you can't continue a lease agreement in your name yet have somebody else actually use the car. The leaseholder has to be the primary vehicle user.
What Happens at the End of the Leasing Agreement?
Unlike with other forms of car finance (such as a PCP agreement), you won't have the option to own the vehicle at the end of a leasing agreement, and it'll have to be returned to the finance provider. And before that point, it'll have to be inspected. (The leasing company will always give you some notice before the inspection is due.) And should all go well, you're then free to go out and lease another car under a new leasing agreement.
For that reason, you'll have to return the vehicle in good condition to the finance provider. Most finance providers demand that the vehicle be returned in line with the BVRLA's fair wear and tear guidelines. An inspector will check the car and you could face a penalty fee if it's discovered that there's any excess wear or damage. But bear in mind that you'll still be able to make modifications to the vehicle throughout the lease term, just not major ones.
What About Mileage?
Yes, there are mileage limitations too, but these can be changed quite flexibly if you find that you're driving more miles than you expected.
The moment you sign a lease agreement, you agree to a set mileage allowance which you must not exceed throughout the contract. Otherwise, you'll find yourself facing excess fees once you return the vehicle and the leasing company checks the mileage.
Luckily, most funders will consider increasing your mileage if you find that you need to exceed the allowance throughout the lease term. Happy days!
What is Included in a Car Lease Contract?
Well, a brand new car for a start . . . (although used lease cars are slowly making their way into the market).
But you'll also benefit from:
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Free and fast UK mainland delivery
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Full manufacturer’s warranty
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Breakdown recovery
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Road tax (VED)
Yes, maintenance isn't typically included, but you can choose to enhance some lease deals by adding a maintenance package, helping to take some of the stress and hassle out of servicing.
What Happens in the Event of the Death of a Lease Holder?
Okay, not the cheeriest of topics, but a necessary one nonetheless, and one which pensioners may have lurking in the back of their minds.
As with other forms of finance (like PCP), if the principal contract holder of a car leasing deal happens to die, the parties whose estate is affected should contact the relevant leasing/finance company as soon as possible.
Ordinarily, early termination fees would apply, but depending on the circumstances, the finance provider may waive the fees in the event of a death. However, this is all dependent on the individual circumstances and the decision may vary on a case-by-case basis, which is why you should contact your finance provider in the first instance.
Summary
So yes, you're never too old to lease a new car, and it's still very much an option if you're a pensioner.
It leasing sounds up your street, then there's a whole range of lease cars just waiting to be driven!
FAQs
Is car leasing a good idea for pensioners?
Yes! Car leasing isn't geared towards any particular age group, so it very much depends on the individual pensioner.
Can you lease a car when you are over 70?
Absolutely. There's no upper age limit.
Is there an age limit on personal car leasing?
Nope. To repeat: no limit whatsoever.
Who qualifies for NHS car lease?
Any permanent employee of the NHS who has completed their probationary period.