Personal Contract Purchase (PCP)
A PCP deal is similar to a HP deal in that you hire the car for the duration of the payments made, but once the period ends, you have three choices:
- You can pay off the remaining lump sum known as a “balloon” payment and claim ownership of the vehicle.
- You can return the vehicle once the balloon payment is due.
- You can part exchange the vehicle and begin a new PCP deal with a new vehicle.
The monthly payments in a PCP deal are usually cheaper than a HP deal because of the balloon payment that contains a significant amount of the value. Because there is a chance that you may not own the vehicle in the future, there is usually a mileage cap in place for the duration of the loan so that the car maintains its resale value.
It is crucial that you submit an application for the financial choice that best fits your situation. For amazing rates on personal contract purchase vehicle financing, see our bad credit PCP car finance page.