Help & Advice

Personal Contract Purchase (PCP)

Personal Contract Purchase (PCP)


Personal contract purchase – generally shortened to PCP – is another finance option on the market. With PCP agreements, you are able to defer ownership of the vehicle until you reach the end of the contract and, in the meantime, you are effectively leasing or hiring it.

This makes a PCP similar in some ways to hire purchase, although the period of hire is at a typically lower rate, since it is based on the value of the car at the beginning of the contract minus its value at the end (it’s agreed “residual value”).

The PCP you sign represents an agreement to continue paying the monthly payments for the hire of the vehicle. At the end of the contract you may hand back the car to its owners or pay a so-called “balloon” payment representing its agreed residual value in order to own it.

In arranging the finance, we need to assess your credit rating, since that is one of the first steps to be taken by any finance company to whom you make formal application.

Typically, you will need a fairly good credit score in order to be approved for a PCP. If your credit profile isn’t quite perfect, it’d be suggested that a hire purchase agreement may be more suitable for you.

At CarFinance 247, you can buy a car, van, motorbike or caravan via any reputable UK dealership, so the choice really is down to you!

Answer correct as of November 2016

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Best available rate

Total repayment

Total cost of credit

We compare products from 18 of the UK's top lenders to get you the best deal.

Hitatchi

Representative example. Excellent Credit

Borrowing £7,500 over 48 months with a representative APR of 16.8%, an annual interest rate of 16.8% and a deposit of £0.00, the amount payable would be: £211.25 a month, with a total cost of credit of £2,640 and a total amount payable of £10,140.

CarFinance 247 is a broker and not a lender

Best available rate
Total repayment
Total cost of credit

Best available rate

Total repayment

Total cost of credit

We compare products from 18 of the UK's top lenders to get you the best deal.

Hitatchi

Representative example. Excellent Credit

Borrowing £7,500 over 48 months with a representative APR of 16.8%, an annual interest rate of 16.8% and a deposit of £0.00, the amount payable would be: £211.25 a month, with a total cost of credit of £2,640 and a total amount payable of £10,140.

CarFinance 247 is a broker and not a lender