Jargon buster: your guide to new and used car finance

Car finance jargon buster

Thanks to cheap car finance, it’s never been easier to buy a new or used vehicle. PCP (Personal Contract Purchase) deals in particular have been at the forefront of a boom period for car finance.

You may be puzzled by finance jargon when sat with the salesperson at the showroom. But help is at hand.

If you’re bamboozled by balloon payments and confused by conditional sales, our guide to car finance jargon will clear the fog. Before you read any further, be sure to check out our essential guide to the most popular car finance options.

The following guide to car finance has been put together with the help of the Finance & Leasing Association (FLA).

Car finance jargon buster

Car finance jargon

  • Administration fee or Documentation fee
    • The charge for setting up the finance and issuing the relevant documents. It will be included in the total amount payable and taken into account when the Annual Percentage Rate (APR) is calculated.
  • Agreement term or length of the agreement
    • The length of time over which you agree to repay the car finance.
  • Annual Percentage Rate (APR)
    • The annual cost of a finance agreement over and above the amount you have borrowed on finance. The cost will include interest rate charges and any other fees. APR can be used to compare different finance products.
  • Annual mileage
    • You will be asked to estimate your annual mileage as this helps the lender to calculate the market value (Guaranteed Minimum Future Value) at the end of the contract. Do not underestimate the figure, as you will be charged excess mileage at the end of the finance contract.
  • Bad credit history
    • If a customer has a record of repayment issues, this will be classed as a bad credit history. Although there are specialist lenders for customers with a poor credit score, the cost of borrowing is likely to be higher.
  • Balance financed
    • The amount you need to borrow – the cost of the car less a deposit or part-exchange allowance.
  • Balloon payment or Guaranteed Minimum Future Value (GMFV)
    • The lump sum deferred to the end of a PCP deal or similar. If paid, you will own the car. In most cases, the balloon payment is optional, but check before you sign the agreement.
  • Cash back
    • An amount refunded to the customer which is not required for a deposit. Cash back is often used as an incentive.
  • Conditional Sale
    • The sale of the vehicle is conditional on the customer completing the terms of the agreement. The customer will automatically own the car at the end of the agreement.
  • Credit agreement
    • A legally-binding contract between the customer and the finance company. It will include the loan amount, the term, the rate of interest and the customer’s rights and responsibilities.
  • Credit rating
    • Part of the scoring system used by finance companies when deciding how to price the risk of finance – and the suitable interest rate.

Car finance hire purchase

  • Deposit contribution
    • A contribution made by the supplying dealer or manufacturer. It will reduce the cost of finance.
  • Depreciation
    • The extent and rate at which a new car loses its value.
  • Documentation fee
    • The charge for setting up the finance agreement and issuing the relevant documents.
  • Early settlement
    • The amount payable should a customer decide to end the finance agreement.
  • Equity
    • The difference between the agreed market value of the car and the loan balance left to pay. If the market value is lower, the term ‘negative equity’ is used.
  • Final payment
    • The last repayment to be made as part of the finance agreement. This may include an option to purchase fee.
  • Fixed rate interest
    • The same interest rate is applied for the duration of the car finance agreement.
  • Flat rate
    • The base interest charged on the finance. The APR figure is a more accurate representation of the cost of finance.
  • GAP (Guaranteed Asset Protection) insurance
    • In the event of an accident, the insurer will pay its current market value. GAP insurance can cover the difference between the market value and the finance left to pay.
  • Gross income
    • The finance provider will ask for proof of your income before tax and National Insurance have been deducted. This is called gross income. Net income is the figure after tax and National Insurance are deducted.
  • Hire Purchase (HP)
    • After an initial deposit, customers pay a series of fixed monthly payments over a set period of time. Although you become the car’s registered keeper, you don’t own it until the final payment is made.
  • Interest rate
    • The price you pay for borrowing the money is called the interest.

Car finance PCP

  • Joint application
    • When two or more people apply for car finance, it is called a joint application.
  • Lease Purchase
    • A form of Hire Purchase in which a sum is deferred until the end of the contract. This sum isn’t optional and must be paid.
  • Monthly rentals
    • The amount paid every month under leasing agreements. They’re not classed as repayments as the car will be handed back to the leasing company at the end of the agreement.
  • Option to purchase fee
    • A voluntary payment which, if paid, transfers ownership of the car to the customer.
  • Part-exchange
    • The amount given to you for your existing car when trading it in for a new one.
  • Personal Contract Purchase (PCP)
  • Quotation
    • Provides an indication of the cost that would apply if you went ahead with the finance. 
  • Residual value
    • The projected value of your car at the end of the finance agreement. Factors such as wear and tear, mileage and market trends may affect the actual value.
  • Secured loan
    • Most finance agreements are secured against the car.
  • Secondary rental
    • To keep renting the car at the end of a lease agreement, it might be possible to arrange a secondary rental. This will typically be in the form of an annual fee or monthly repayments.
  • Term
    • The length of the finance agreement.
  • Trade value
    • How much the car is worth if sold at auction or purchased by a dealer.
  • Unsecured loan
    • A loan that isn’t secured against the car.

For more helpful information, check out our advice section.

Is your cheap car insurance too good to be true?

The cost of car insurance admin fees

Drivers are being warned to avoid so-called ‘ghost brokers’, who pose as legitimate car insurance brokers to sell forged or invalid policies.

Unsuspecting drivers are lured by cheap premiums that turn out to be too good to be true.

Young drivers aged 17 to 24 are most likely to fall victim to ghost brokers. Facing higher premiums, and armed with a tight budget, they’re attracted by the promise of a good deal.

They’re also likely to be active on social media – a prime hunting ground for the insurance scammers.

Non-English speaking communities are also at risk, according to Action Fraud.

Victims will be unaware they don’t have genuine cover until they submit a claim or are stopped by the police for driving without insurance. Although the police will be sympathetic, the consequences can be the same as driving uninsured.

No-claims bonus savings on car insurance

Sanctions include a fine, penalty points, disqualification from driving, a criminal record, and the risk of having a car seized by the police.

Fleur Lewis, head of fraud detection and prevention at GoCompare, said: “Younger, less experienced drivers pay more to insure their cars – which makes them particularly susceptible to adverts for heavily-discounted insurance.

“Ghost brokers often operate on social media, especially Facebook and Instagram, where they often use imagery and logos of established insurers to enhance their believability.”

Ben Fletcher, director of the Insurance Fraud Bureau (IFB), added: “Ghost broking is a serious issue, which shows little sign of slowing down. A third of all our investigations are focused on bringing ghost brokers to justice.”

How a ghost broker defrauds a victim

Ghost brokers typically defraud victims in one of three ways:

  • Forged insurance documents.
  • Manipulating the customer’s details to lower the premium. This could be done by using fake no-claims discount letters or by supplying a low-risk address.
  • Using the identity of an unauthorised third party, before cancelling the policy to pocket the refund on top of the victim’s fee.

How to spot a ghost broker

  • Be wary of unsolicited cars from insurance brokers – authorised firms are unlikely to cold-call potential customers.
  • Ghost brokers will use social media, pubs or adverts in newsagents or universities – be on your guard.
  • Check to see if the broker has an office address and landline telephone number.
  • Is the broker on the Financial Services Register and authorised by the Financial Conduct Authority or the British Brokers’ Association?

If you suspect you have been contacted by a ghost broker, report it to Action Fraud or to the Insurance Fraud Bureau’s Cheatline.

Remember, if it sounds too good to be true, it probably is.

How to save money on car parking

How to save money on car parking27

Parking pain can really knock the wind out of all manner of fun days out. From visits to the big city, to a trip to the beach – either way a requirement for any far-away excursion you can think of, is somewhere to dump the car. Chances are, if it’s somewhere you want to be, it’ll be somewhere others want to be, too. That means one thing: limited parking, and when it is available, it’s expensive. 

So here’s a guide from us on car parking, from booking ahead, to clever alternatives, to avoiding taking the car altogether. We start with the basics.

Ask around

You never know who knows what. Finding somewhere to leave your car could be a puzzle solved with a simple query to a friend that’s been where you want to go before. Here’s an example. Having spent four years living in Cambridge, I personally know where all the free parking is in one of the most car-unfriendly cities in the UK, as well as what of it is most likely to be available. The life experience of your friends and loved ones is an invaluable resource for all any and all problems life throws at you, including finding good places to dump your wheels.



So your friends and family have come up short. What do you do? Thankfully, the world’s biggest brain, the internet, has your back. As its name suggests, Parkopedia is the Wikipedia of the parking world. The website claims to cover 75 countries and over 6,000 towns, giving you access to over 38 million parking spaces. This number is rising all the time, as demonstrated by the ever-increasing figure at the top of the homepage.

It’s all rather easy: you simply search for your desired location and Parkopedia displays a map of the car parks within the immediate vicinity. You can check out the prices and opening hours, as well as any restrictions or items of note.

The map also features a handy ‘traffic light’ system, enabling you to locate the cheapest car parks.

There’s also a smartphone app, while some car parks give you the opportunity to book ahead. Whether you commute to work or are visiting a city for the first time, the Parkopedia website could save you enough to pay for a good lunch.

Connected cars – the future of parking?

Connected cars create a variety of opportunities to streamline motoring life. Wejo is an app in development that uses this technology to, among other things, help you find free car parking spaces quickly and easily. Being connected to other cars, means those cars can ‘tell’ your car when they’re leaving a parking space. The car park ballet dance could become a thing of the past. 

Book ahead

This is especially important if you intend to leave your car at an airport. Use the official Heathrow Airport website to book seven days of parking and the savings are significant. 

The prices will vary depending on availability and how early you book, but you will benefit from booking in advance, even if it’s on the day of travel.

Long stay, not short stay


Sticking with airports, there are obvious benefits associated with short stay car parks. Take Heathrow Airport Terminal 5 – it’s a 2-4 minute walk to the short stay car park, compared with a 5-7 minute bus ride to the long stay.

In some airports it feels like the long stay car park is located in an entirely different continent, so you might argue the convenience of being closer to the terminal outweighs the pain associated with the 20-minute ride in a minibus.

Use a price comparison website

There seems to be a price comparison website for just about everything these days, including airport parking. Holiday Extras is one of the biggest and the most established of all the sites, and the savings can be significant.

The website claims you could save up to 60% versus the price you’d pay on the day. Holiday Extras also offers a best price guarantee, meaning they’ll refund the money if you find the same airport parking cheaper elsewhere.

It’s important to do your homework, because not all price comparison sites are as reputable as the market leaders. It’s also worth remembering that cheaper doesn’t necessarily mean better. Research your options before you book.

Hotel package deals

If you’ve booked a room the night before your flight, ask if it’s possible to leave your car at the hotel for the duration of your trip. Some hotel operators offer a hotel+parking package deal, so ask about this when booking your accommodation.

This also applies to city centre breaks. Ask the receptionist if the hotel offers on-site parking, as this could save you tens of pounds over the course of a long weekend. Some hotels will offer free parking on a first come first served basis, while others will expect a small fee. Check to see if the local pay and display is cheaper.

Park on the edge of the city


In basic terms, the closer you get to the city centre, the more expensive the cost of parking. You’ll also have to do battle with the inevitable congestion and fight for that single elusive free parking bay.

Do yourself a favour and find a car park on the edge of the town or city. In some cases, the parking might be free, but it will almost certainly be cheaper. If you’re worried about the walk, take the bus into the city centre.

In our own experience, only last month we mored up in St Albans over the August Bank Holiday from Saturday to Monday, for free, and got the train into London. That’s three days of free parking. Lord knows what that would have cost in the city itself, and whether it would have even been available.

Park and ride

Speaking of which, using a park and ride facilities are the industrialisation of this tactic. They do tend to work out cheaper than parking in a city. Using Plymouth as an example, you’ll pay £3.40 for an adult return ticket from the George Junction park and ride.

Hire a driveway


When you think about it, this makes perfect sense. During working hours, your driveway is likely to be empty, so why not invite somebody else to park there?

There are a number of websites offering a search facility, including yourparkingspace.co.uk, which includes well over 250,000 hourly, daily and monthly parking spaces across the country.

We searched for driveways for a Saturday visit to London. Over 2,300 results came back in a variety of locations, offering parking for over 24 hours.

Booking is easy: you simply select your arrival and departure times, key in your details, pay online, and the website provides the full address of the space along with the contact details of the owner.

Buy an electric vehicle


Buying a new car to save money on car park costs might be a tad excessive, but driving an electric vehicle will reduce the amount of cash you spend at car parks.

Many car parks offer free parking while your EV is being recharged, while some will allow you to park for free, regardless of whether you’re charging or not. Assuming you pay £2 per day to park at work, you might save over £400 a year by driving an electric car.

Look for cashback options

To encourage people back into towns and city centres, some local authorities and business groups offer incentivised parking. In other words, whilst you’ll still be asked to pay and display, the cost is refunded if you spend a certain amount in a participating shop.

Similarly, a supermarket situated in a town or city centre might offer a refund if you happen to shop in store. As one supermarket might say: every little helps, right?

Car park season ticket

If you park in the same car park on a daily basis, it might be worth considering a season ticket. NCP claims a season ticket could save up to 70% on the cost of parking, with the added benefit of not having to search for loose change.

On a similar note, it can pay to be a member of the National Trust. Spend a week on holiday in somewhere like Cornwall and you could spend a small fortune on parking at one of the many National Trust car parks. Membership starts from £72 a year – a cost you could recoup on car park fees alone.

Use the correct change


Those cheeky car park operators want to extract every last penny from your wallet and you’ll often see a ‘no change given’ notice stuck to the pay and display machine. It’s a simple thing, but make sure you use the correct change.

Alternatively, pay by card or use one of the parking apps, such as RingGo. This cashless solution allows you to pay via your smartphone and will provide an alert when your time is running out.

Look for alternatives to the car

Whilst we appreciate that you’re hardly going to take the bus to a famous Swedish furniture store to collect a new wardrobe, or cycle into town to pick up your groceries, you have to ask yourself: do I really need to take the car?

Would it be cheaper to take the bus? Could you walk into town? Would it be easier to cycle into work? Could you share a car with somebody else, going Dutch on the cost of the car park?

Railway stations are notoriously expensive places to park, so have you considered cycling to the station? The rail fares are expensive enough without the cost of moring up lumped on top.


Buy a car park space

Sounds extravagant? That’s because it most probably is. Parking is an expensive business, so you could consider buying a car park space. Not that this is the cheapest option. Spaces in London can stretch into six figures – enough to buy a house elsewhere in the country…

Don’t park in a hurry


If you’ve followed our advice, you’ll never have to park in a hurry again. If you’re forced into a corner, either through lateness or a lack of planning, you’ll choose the wrong and often most expensive car park.

A little forward planning goes a long way.

The best new car leasing deals

Volkswagen Golf RCar leasing – or Personal Contract Hire (PCH) – is a cost-effective alternative to a Personal Contract Purchase (PCP) deal.

It works in a similar way to a business car lease, with motorists paying an initial rental cost and then a flat monthly fee. In the case of personal car leasing deals, VAT is included in the price, and at the end of the contract you simply hand the car back.

Here, we reveal 20 car leasing deals that have caught our eye. All images are for illustrative purposes and the deals are correct at the time of writing (5 August 2019).

Ford Fiesta – £152.98 a monthFord Fiesta

There are plenty of good leasing deals available on Britain’s most popular new car. All Car Leasing is offering the Ford Fiesta 1.0 EcoBoost Titanium X for £145.04 a month after an initial rental of £1,305.40. This is based on a 48-month contract and 5,000 miles a year.

Find out more about this deal

Peugeot 3008 – £238.74 a monthPeugeot 3008

Sticking with All Car Leasing, the Peugeot 3008 1.5 BlueHDi Allure is available for £238.74 after a £2,148.66 initial rental. This is based on a 36-month contract and 8,000 miles a year.

Find out more about this deal

Vauxhall Astra – £126.26 a monthVauxhall Astra

A revised Vauxhall Astra is on the way, which means the outgoing version is available with some tempting lease deals. Leasing.com is offering the 1.6-litre petrol Elite Nav for £126.26 a month after an initial payment of £1,331.34. This is based on 24-month contract and 5,000 miles a year.

Find out more about this deal

Mazda MX-5 – £178.79 a monthMazda MX-5

Fancy seeing out the summer in a sports car? Hippo Leasing is offering the Mazda MX-5 1.5 SE for £178.79 a month over four years. This is after an initial payment of £1,609.09, with the mileage restricted to 5,000 a year.

Find out more about this deal

Renault Kadjar – £201.45 a monthRenault Kadjar

The Nissan Qashqai might be the country’s most popular crossover, but the platform-sharing Renault Kadjar is arguably the better car. Nationwide Vehicle Contracts is offering a Kadjar in GT Line spec for £201.45 a month after an initial rental of £1,208.70. This is based on a 48-month contract and 8,000 miles a year, although other options are available.

Find out more about this deal

BMW 3 Series – £304.79 a monthBMW 3 Series

This is true of all the deals featured here – the leasing companies offer flexible mileage restrictions and contracts. The BMW 3 Series is a popular choice for business users, but Select Car Leasing is offering the 320i M Sport to personal customers for £304.79 a month. You’ll pay an initial £2,743.09 and be restricted to 5,000 miles a year over three years.

Find out more about this deal

Jaguar XF – £257.23 a monthJaguar XF

Moving up a segment, the Jaguar XF is available for less than the BMW 3 Series. You’ll pay £257.23 a month via All Car Leasing after an initial rental of £2,315.09. This is based on a 24-month contract and 5,000 miles a year.

Find out more about this deal

Seat Leon – £185.98 a monthSeat Leon

The ‘Spanish Golf’ is available for £185.98 a month after an initial rental of £1,115.86. The deal is based on the Seat Leon 2.0 TDI FR on a 36-month contract, with First Vehicle Leasing restricting you to 8,000 miles a year.

Find out more about this deal

Vauxhall Corsa – £138.06 a monthVauxhall Corsa

There’s a new Vauxhall Corsa on the way, which means the outgoing version is ‘going cheap’. Nationwide Vehicle Contracts is offering the well-equipped 1.4 SRi VX-Line Nav for £138.06 after an initial rental of £828.36. This is based on 48 months and 5,000 miles a year.

Find out more about this deal

Tesla Model 3 – £361.19 a monthTesla Model 3

Fancy leasing one of the most-wanted cars on the market? Select Car Leasing is offering the Tesla Model 3 for £361.19 a month after a relatively hefty £3,250.60 initial fee. This is based on a 24-month contract and just 5,000 miles a year.

Find out more about this deal

Skoda Octavia vRS – £227.81 a monthSkoda Octavia vRS

If you haven’t fallen for the charms of an SUV, the Skoda Octavia estate makes a great deal of sense, especially in vRS guise. All Car Leasing is offering the 2.0-litre TSI 245 for £227.81 a month after a £2,050.27 initial rental. This is based on 48 months and 8,000 miles a year.

Find out more about this deal

Fiat 500 – £117.68 a monthFiat 500

Nationwide Vehicle Leasing is one of a number of companies offering the Fiat 500 for a tempting price. The 1.2 S can be yours for £117.68 a month for four years after an initial rental of £706.08. The 5,000 miles a year restriction might be enough, but it can be increased in exchange for a higher monthly payment.

Find out more about this deal

Volkswagen Golf GTI – £253.19 a monthVolkswagen Golf GTI

There’s still time to get your hands on the current Volkswagen Golf GTI. Select Car Leasing is offering the GTI Performance for £253.19 a month on a two-year contract. You’ll pay an initial £2,278.69, although you might find the 5,000 miles cap a little too restrictive.

Find out more about this deal

Volkswagen Golf R – £297.59 a monthVolkswagen Golf R

You could have a similar problem with this deal, but a Volkswagen Golf R for less than £300 a month will be a tempting proposition for many motorists. The initial fee is £2,678.29, with the All Car Leasing contract lasting 36 months.

Find out more about this deal

Toyota Corolla – £207.22 a monthToyota Corolla

The Corolla is back in Britain, and you can lease one for £207.22 a month. The Hippo Leasing deal is based on the 1.8 hybrid in Icon trim and follows an upfront payment of £1,864.95. The 48-month contract limits you to 10,000 miles a year.

Find out more about this deal

Volkswagen Polo – £166.04 a monthVolkswagen Polo

Select Car Leasing is offering the Volkswagen Polo 1.0 Evo 80 Beats for £166.04 a month after an initial payment of £1,494.40. The 8,000 miles a year limit doesn’t sound too restrictive, but you’ll be tied into a four-year contract.

Find out more about this deal

Volvo S90 – £225.36 a monthVolvo S90

Leasing.com is offering a big car for not an awful lot of money. The Volvo S90 2.0-litre T4 Momentum is available for £225.36 a month after an initial payment of £2,388.24. The 5,000 miles a year limit is a bit miserly for a car of this size, especially over a four-year contract.

Find out more about this deal

Dacia Logan MCV – £155.99 a monthDacia Logan MCV

Britain’s cheapest estate car is available for £155.99 a month via First Vehicle Leasing. The deal is based on the Dacia Logan MCV in Comfort trim, with only £935.93 to pay upfront. This price is based on 5,000 miles a year and a three-year contract.

Find out more about this deal

Citroen C4 SpaceTourer – £55.19 a monthCitroen C4 SpaceTourer

This is only a short-term deal, but just look at the monthly payment. National Vehicle Solutions is offering a Citroen C4 SpaceTourer 1.2 PureTech Flair for £55.19 a month after an £1,800 initial rental. The 10,000 miles per year restriction is far from unreasonable.

Find out more about this deal

Jaguar I-Pace – £460.24 a monthJaguar I-Pace

The current World Car of the Year is one of the must-have electric cars right now, but leasing isn’t a cheap option. That said, £460.24 a month for the Jaguar I-Pace EV400 S puts it on a par with more conventional premium motors, as does the £4,142.12 initial fee. The Select Car Leasing deal is based on a three-year contract and 5,000 miles a year.

Find out more about this deal

Cheapest new cars for young drivers to insure

The cheapest new cars for young drivers to insure

Cheapest new cars for young drivers to insure

You’re young, you’ve just passed your driving test, and you’ve got the keys to independence. It’s time to buy a car. Only it’s not that simple, because the shortlist of four-wheeled delights you’ve lined up for your first taste of the open road soon becomes even shorter. The problem: car insurance.

Research by the Association of British Insurers (ABI) has revealed that one-tenth of a young driver’s salary is spent on car insurance, and that’s before you’ve factored in the cost of fuel, servicing and the monthly repayments on your new motor. Comparethemarket.com has released details of the top 10 cheapest cars to insure for 17-24 year-olds, based on the average price returned for vehicles with more than 1,000 enquiries for a particular model. Opt for one of these motors and you stand a better chance of not paying over the odds.

10. Citroen C1: £1,267.24

Cheapest new cars for young drivers to insure

A car’s insurance group rating will play a big part in the price you pay for your annual premium, with groups ranging from one to 50. The lower the group, the less you’ll pay, but other factors will influence the price, such as your postcode, employment status, how many miles you drive in a year and the value of the car.

According to Comparethemarket.com, the new Citroen C1 costs an average of £1,267.24 to insure, which is actually more than the £973 average quoted by ABI in its young driver analysis. A couple of things play a part here: this average is based on 18-21 year-olds and it also includes cheaper, used vehicles.

9. Ford Ka+ Zetec: £1,267.06

Cheapest new cars for young drivers to insure

“More than any other drivers, young motorists need relief from rising motor insurance premiums. While telematics technology is helping many young drivers manage their insurance bills, cost pressures keep mounting. The Government has a key role in helping keep motor insurance costs under control, and this latest analysis highlights why they need to implement their proposals to reform personal injury compensation and lower value whiplash-style claims as soon as possible,” says James Dalton of the ABI.

The Ford Ka+ won’t top many lists of dream cars, but at least the insurance premium is unlikely to result in too many nightmares. The basic Ka+ Studio slots into the lowest insurance group, although Comparethemarket.com says the Ka+ Zetec 1.2 Ti-VCT 70PS is the one to have.

8. Kia Rio 3: £1,265.39

Cheapest new cars for young drivers to insure

The only Kia to be referenced in an Arctic Monkeys song – sort of – but the Rio won’t cut the mustard on the dancefloor. But, do you wanna know how much it will cost to insure Kia’s supermini? Around £1,265, if Comparethemarket.com is correct.

Prices start from £11,995, but you’ll have to dig deep to secure a Rio 3, for which the lowest price is £16,785. As first cars go, a well-specced Kia Rio 3 would be quite a start. Sure beats a rusty Mk3 Ford Fiesta or an Austin Metro with a hole in the floor. Or does it?

7. Vauxhall Viva: £1,259.76

Cheapest new cars for young drivers to insure

It is said that young drivers are falling out of love with the car, but when faced with the prospect of the Vauxhall Viva, is it any wonder? Sure, the Viva is a thoroughly decent car, but since when was ‘thoroughly decent’ good enough for a young person? The Max Power generation wouldn’t have stood for it.

In fairness to the Vauxhall Viva, it does exactly what it says on the website: “Just think of the Vauxhall VIVA as insanely rational. It has everything you need, including five doors, five seats, class-leading comfort, ride and handling, together with class-defining assistance technology.” If you’re insanely rational, this is the car for you. Probably.

6. Fiat 500: £1,258.32

Cheapest new cars for young drivers to insure

The Fiat 500 could be the automotive case of having your cake and eating it. It offers character and style by the bucket load and won’t break the bank when it comes to lacing your insurance broker’s palm with silver.

Much will depend on which engine size and trim level you opt for as insurance groups range from seven to 15. The 1.2-litre is likely to be cheaper to insure than the fizzy 0.9-litre TwinAir.

5. Skoda Citigo: £1,212.87

Cheapest new cars for young drivers to insure

The Skoda Citigo might be the cheapest of the Up/Mii/Citigo trio, but it’s likely to be the most expensive to insure. But before you go running to your local Volkswagen or Seat dealer, it’s worth remembering that some models fall into the lowest insurance group.

Even the top trim levels with GreenTech engines slot into group four, so drive a Citigo for a year, build up some no-claims discount and you’ll be laughing all the way to the bank. Or all the way to your banking app.

4. Volkswagen Up: £1,210.58

Cheapest new cars for young drivers to insure

You’re young and enlightened, so you’re probably not bothered about the old Skoda jokes (ask your parents), but if you’re swayed by the VW roundel, the ‘Up exclamation mark’ is a wise choice.

According to Comparethemarket.com, it should be cheaper to insure, although you’ll want to avoid the turbocharged versions if you’re hoping to run a car on a strict budget. No GTI frolics for you. Well, not yet, anyway.

3. Seat Mii: £1,191.77

Cheapest new cars for young drivers to insure

This lady has just been shopping. Why? Because she’s just saved a packet on her car insurance. Lower premiums mean more money to spend in Mango. Or something.

Seat is gunning for the female market with the Mii, which is why its website is filled with images of international bright young ladies. Jogging with dogs, chatting with friends, connecting a smartphone – it’s all there.

2. Vauxhall Adam: £1,189.14

Cheapest new cars for young drivers to insure

The Vauxhall Adam is the very antithesis of the Viva, offering more personalisation options than you could shake a stick at. There are three trim levels to choose from – Jam, Glam and Slam – along with the crossover-styled Rocks and sporty S.

You will, of course, need to avoid the S to ensure your insurance quote stays the right side of a price comparable to the national debt, but many Adam models slot into groups two and three.

1. Fiat 500X: £1,040.39

Cheapest new cars for young drivers to insure

This is a surprise: the Fiat 500X might be the cheapest car to insure for young drivers. The groups range from five to 16, but this isn’t reflected in the prices returned by Comparethemarket.com. But ask yourself this: do you really want to drive a crossover at your age?

The Comparethemarket.com data would suggest otherwise, as the most popular car to insure for 17-24 year-olds is the Vauxhall Corsa. Other modes in the top 10 include the Ford Fiesta, Volkswagen Polo, Renault Clio, Seat Ibiza and Fiat Punto. The Audi A3 also gets a mention, which is proof that badges matter.

Read more:

Revealed: the cheapest cars to insure

Revealed: the cheapest cars to insure

Revealed: the cheapest cars to insureLooking to save money on your car insurance? Comparethemarket.com has released details of the top 10 cheapest cars to insure, based on the average price returned for cars with more than 1,000 enquiries for a particular model. By choosing one of these cars, you stand a better chance of not paying through the nose.

10. Dacia Duster: £541.72

Revealed: the cheapest cars to insure

According to Comparethemarket.com, where you live and where you store the car can have a big effect on the price of car insurance. The premium is affected by the risk of the vehicle being stolen and being bumped into when parked. Having access to a garage might lower the premium, but some insurers increase the price based on drivers misjudging the width of their car.

9. Mazda CX-5: £535.95

Revealed: the cheapest cars to insure

Your employment status will have also affect the premium. For example, you’ll pay more if you drive regularly as part of your job or if you carry expensive tools or equipment in your vehicle. Racing drivers pay more, as do journalists and window cleaners

8. Hyundai ix20: £531.21

Revealed: the cheapest cars to insure

Well-mannered and law-abiding citizens drive cars like the Hyundai ix20, which is why it’s a cheap car to drive. Having three points on your licence for a minor speeding offence will have a small impact, whereas a previous ban for drink-driving will make it hard to find a cheap policy. Some insurers will refuse to insure a previously convicted drink-driver.

7. Skoda Kodiaq: £515.48

Revealed: the cheapest cars to insure

The Skoda Kodiaq is one of the best crossovers on the market, but it’s not going to appeal to a young driver. For 17 to 25-year-olds, the cost of insurance can be as expensive as the vehicle itself, but the premiums will start to decrease from the age of 26.

6. Renault Kadjar: £507.89

Revealed: the cheapest cars to insure

Comparethemarket.com is very specific here, referencing the Renault Kadjar Dynamique S Nav dCi 110 as one of the cheapest cars to insure.

5. Kia Venga 3: £499.26

Revealed: the cheapest cars to insure

Look, it’s the Kia Venga…

Comparethemarket.com loves the Kia Venga, boys.

4. SsangYong Korando: £495.92

Revealed: the cheapest cars to insure

The SsangYong Korando offers exceptional value for money, with prices starting from as little as £16,295. It should be cheap to insure, with Comparethemarket.com quoting an average of £495.92 for the SUV.

3. Citroen C3 Picasso: £488.22

Revealed: the cheapest cars to insure

The Citroen C3 Picasso has been replaced by the new C3 Aircross, but the old model is the one to have if you’re hoping to save money on your car insurance.

2. Skoda Roomster: £481.44

Revealed: the cheapest cars to insure

The Roomster disappeared from the Skoda range in 2015, but its practicality and clever packaging means that it’s a popular used car. It’s good to know it’ll be cheap to insure.

1. Skoda Yeti: £456.49

Revealed: the cheapest cars to insure

But it’s not the cheapest, because that accolade belongs to the now-departed Skoda Yeti. Another good reason to buy the quirky and brilliant Yeti, as if you needed an excuse.

Read more:

changes to road tax 2017

New 2017 road tax rules: a five-minute guide

changes to road tax 2017

From 1 April 2017, Vehicle Excise Duty – commonly known as road tax – is set for some major changes. If you’re looking to buy a new car in 2017, you really need to know about these and how they might affect you.

First things first – if you own a car registered before 1 April 2017, the changes don’t affect you. But if you’re in the market for something new, you have until the end of March 2017 if you don’t want to be stung by the reforms.

And that’s because, while there’s good news for some, the majority of drivers could be left out of pocket. Read on to find out more.

Why is the system changing?

Cast your mind back to the budget of summer 2015, when the Chancellor of the Exchequer announced an overhaul of the current system. According to then Chancellor, George Osborne, the changes are required to fill a hole in the Treasury’s coffers.

In simple terms, you’re buying too many super-efficient petrol and diesel cars, and with a taxation system based on CO2 emissions, the government has been left out of pocket. Indeed, Osborne claimed that, under the current system, 75% of new cars would be eligible for free road tax by 2017.

Something had to give.

What are the changes to road tax?

The rate of Vehicle Excise Duty (VED) will still be split into 13 bands and calculated on a vehicle’s CO2 emissions. Only cars with 0g/km CO2 emissions will be eligible for free road tax. This is a big deal.

Since March 2001, new cars emitting less than 130g/km CO2 have been tax exempt in the first year, and subject to a sliding scale of taxation for each year thereafter. For example, buy a car in band B (101-110g/km) and you’ll pay nothing in the first year and just £20 from year two.

From April 2017, the cost will rise considerably. Not only will you pay £140 in the first year, you’ll also pay £140 in the second year and each year thereafter. So at the end of year three you’ll have spent £420 on tax – £380 more than if you bought the same car a month earlier.

The first-year rate of tax is based on a sliding scale, ranging from free road tax for electric and hybrid vehicles, to £2,000 for cars with CO2 emissions in excess of 255g/km. From the second year, all but the zero emissions cars move to flat rate of £140.

This is potentially good news for buyers of the least efficient cars on sale. Take the Bentley Flying Spur with a V12 engine. With CO2 emissions of 335g/km, under the current system you’ll pay £1,120 in the first year and then a hefty £515 from the second year.

Using the new system you’ll have to find £2,000 for the first year, but the second year rate drops to the standard £140. Keep the car for a few years and you’ll be quids in. But there is a catch…

From April, all vehicles with a list price of over £40,000 – including zero emission cars – will attract an additional rate of £310, payable each year for five years from the end of the first vehicle licence. At this point it drops to the standard rate.

Which means a Tesla Model S will cost £310 a year – a big shock for those who might be expecting free road tax.

Is it worth buying a car before April?

If you’re in the market for an efficient petrol, diesel or hybrid vehicle, it’s almost certainly worth registering it before the end of March. Indeed, industry experts are expecting one of the busiest months on record, as buyers also rush to grab a car with a new 17-plate.

Say, for example, you buy a new Suzuki Celerio with a 1.0-litre engine emitting 99g/km CO2. Register the car before the end of March and you’ll pay no road tax whatsoever. From April, you’ll pay £120 in year one and then £140 from year two. Three years on and you’re £400 out of pocket.

The case isn’t quite as clear cut when it comes to the least efficient vehicles, and much will depend on how long you intend to keep the car. There’s also the penalty for £40,000 cars to take into consideration.

Oh, and don’t think you’ll be able to escape the £310 fee by negotiating the price down below £40,000. The government will use the published list price. Go easy on the options, too, as these could push your car beyond the £40k mark.

Do the changes affect my current car?

Tax rates for vehicles registered on or before 31 March 2017 will not be affected by the changes.

VED bands and rates for cars first registered on or after 1 April 2017

CO2 emissions (g/km)First year rateStandard rate*
1 – 50£10£140
51 – 75£25£140
76 – 90£100£140
91 – 100£120£140
101 – 110£140£140
111 – 130£160£140
131 – 150£200£140
151 – 170£500£140
171 – 190£800£140
191 – 225£1200£140
226 – 255£1700£140
Over 255£2000£140

*Cars with a list price of over £40,000 when new pay an additional rate of £310 per year on top of the standard rate, for five years.

Van insurance costs rise in 2016

Van insurance costs rocket 11.7% in a year

Van insurance costs rise in 2016The cost of insuring a van has vastly outstripped inflation, rising by 11.7% in the 12 months to October 2016.

That’s according to Consumer Intelligence, which reveals the average van insurance policy is now priced at £1,591 – double the typical ‘best-buy premium’ for insuring a car.

Unsurprisingly, under-25s pay the most to insure their vans: a whopping £4,770 a year. However, costs for this age-group have risen by a relatively modest 3.6% – still above inflation, but lower than for van drivers overall.

Rising costs haven’t harmed van sales in the UK, though. The Society of Motor Manufacturers and Traders says that 318,664 new vans have left showrooms so far this year – an all-time high. 

Ian Hughes, chief executive of Consumer Intelligence, said: “Van drivers are paying double the average car insurance premium of £788, and with more people using their vans for work that adds to the costs of doing business.”

Consumer Intelligence suggests that drivers opt for ‘carriage of own goods’ cover to save money. This is suitable for ‘workers such as builders, plumbers, carpenters and shopkeepers who commute to work’ and has an average premium of £1,364.

By contrast, drivers who choose ‘social, domestic and pleasure’ insurance are stumping up £2,529, with premiums up by 15% in the past year.

Clarifying the difference between the two types of cover, Mr Hughes said: “Carriage of own goods cover can also include social, domestic and personal use. Drivers opting for social domestic and pleasure use generally have pastimes or hobbies that suit having a van as either their sole vehicle or as a second vehicle.”

Buy a used Nissan Leaf for £175 a month - with a tiny deposit

Buy a used Nissan Leaf for £175 a month – with a tiny deposit

Buy a used Nissan Leaf for £175 a month - with a tiny deposit

More than 15,000 Nissan Leafs have been registered in the UK this year – meaning it holds onto its crown as the country’s most popular electric car.

But the firm says, after four years on sale, the number of used examples on the market are increasing – making it more accessible than previously.

As such, Nissan is launching a £1,000 dealer deposit contribution towards a PCP deal on used examples of the Leaf – meaning you could drive one for £175 a month, following a deposit of just £175.

Available on the 24kWh Acenta model, buyers get a 12 month warranty and free home charge unit, while interest works out at 3.9% APR.

You’ll own the battery outright – although new examples are available with the battery leased from £70 a month – and Nissan will replace any part of the battery causing capacity loss below nine bars (out of 12), within the three-year battery warranty period.

A search on Auto Trader, meanwhile, reveals you can buy a three-year-old Leaf with 61,000 miles on the clock for £5,599 – and the dealer selling it is offering 0% finance.

If you’d prefer a new one, you can buy a new Acenta 24kWh for £249 a month over three years. This follows a deposit of around £2,500, while interest works out at 5.99% APR.

Should 'black box' insurance become mandatory for young drivers?

Should ‘black box’ insurance become mandatory for young drivers?

Should 'black box' insurance become mandatory for young drivers?

A black box manufacturer is calling on the Government to make telematics-based insurance a legal requirement for all drivers under the age of 21.

The increasingly popular telematics insurance policies are aimed at young drivers who are traditionally seen as higher risk, and pay more for their insurance as a result.

These policies fit a black box to the driver’s car, monitoring things like how often they speed, and where and when they drive. They can even report how aggressive they are during braking and cornering.

Careful drivers who avoid risky times and places are rewarded with lower premiums, while high-risk drivers are penalised with pricier insurance – and even face having their policy cancelled.

Black box provider Wunelli says the Government should be doing more to encourage the use of black boxes to monitor young peoples’ driving, claiming that drivers with telematics insurance are 20% less likely to be involved in a crash.

It says new drivers are now paying close to £2,000 a year in insurance on average, and this could go up as the Government increases insurance premium tax for the third time in five years.

The company says young drivers should be encouraged to use telematics insurance by cutting tax on black box policies, or going one step further and making it mandatory for under-21s.

It claims that, with 1,732 road deaths last year (and 14% of the drivers killed aged under 24), the UK Government could save millions by making telematics a legal requirement for young motorists. This would replace the income generated from the tax imposed on young driver policies.

“As the UK currently has no graduated licensing in place, it is crazy to think that young drivers can pass their test one day and the next day be driving a car full of people, on the motorway late at night,” said Wunelli’s founding director, Paul Stacy.

“Even if they have traditional motor insurance, there is no way to monitor their driving behaviour in those crucial first few years.”

According to the latest travel trends survey, the average 17-20 year old drives 1,307 miles per year – meaning they pay more than 12 times more per mile compared to older drivers.