Personal Contract Purchase (PCP) is a finance product that allows you the opportunity to buy a new or a used car.
It is similar to a Hire Purchase agreement as you will usually
pay an initial deposit, followed by monthly instalments over a term
typically between 18 to 48 months.
What makes PCP different to Hire Purchase (HP) is that your
monthly instalments are paying off the depreciation of the car, and not
its entire value, over the course of the term. Then, when you get to the
end of your agreement, there is a final, balloon payment that must be
made if you want to keep the car. The balloon payment is often referred
to also as the Guaranteed Future Value (GFV).
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