Heading
Close X
Menu
Personal Contract Purchase (PCP) is a popular finance option that can be used to purchase either a new or used vehicle.
Like a Hire Purchase (HP) agreement, PCP typically involves an initial deposit followed by fixed monthly payments over an agreed term, usually between 18 and 48 months.
The key difference is that your monthly payments cover the vehicle's expected depreciation during the agreement, rather than its full value. This often results in lower monthly repayments compared to HP.
At the end of the agreement, you will have the option to make a final lump sum payment, known as the Guaranteed Future Value (GFV) or balloon payment, if you wish to own the vehicle outright.
Once you have chosen your vehicle, we'll help you agree on an annual mileage allowance and select a finance term that suits your needs.
Using this information, we will calculate the Guaranteed Future Value (GFV) of the vehicle at the end of the agreement and provide a tailored deposit and monthly payment plan.
At the end of your agreement, you'll have three options:
Return – Hand the vehicle back to us, subject to the terms of the agreement.
Retain – Keep the vehicle by making the optional final payment.
Renew – Part exchange your current vehicle and choose a new one.
If you would like a personalised quotation or further information about PCP finance, please get in touch with our team who will be happy to help.
Some of the key benefits of PCP finance include:
Before choosing a PCP agreement, it is worth considering the following:
Yes, in most cases you can settle a PCP agreement before the end of the term by requesting a settlement figure from your finance provider.
The settlement figure represents the amount required to clear the remaining finance. If the vehicle's current value is lower than the outstanding balance, you may need to pay the difference, which is often referred to as negative equity.
Alternatively, if the vehicle is worth more than the amount owed, you may have positive equity. This can often be used towards a deposit on your next vehicle, helping to reduce future finance costs.
Hire Purchase (HP) is a straightforward way to finance the purchase of a new or used vehicle. Typically, you'll pay an initial deposit followed by fixed monthly payments that cover the full cost of the vehicle over an agreed term.
Unlike PCP, there is no large final balloon payment to make. Once you have completed all scheduled repayments and any applicable fees, ownership of the vehicle is transferred to you, and the car is yours to keep.
Some of the main benefits of Hire Purchase (HP) finance include:
Before choosing a Hire Purchase agreement, it is worth considering the following:
Yes, in most cases you can settle a Hire Purchase agreement before the end of the term by requesting a settlement figure from your finance provider.
The settlement figure will include the outstanding balance of the agreement and any applicable charges. Once this amount has been paid, the finance agreement is brought to an end and ownership of the vehicle can be transferred to you sooner than originally planned.
If you are considering early settlement, your finance provider will be able to explain the options available and provide a personalised settlement quotation.
