Car-finance.net have specialised in Personal Contract Purchase (PCP) and Lease Purchase (LP) online since 2001 and in that time we have built up relationships with no fewer than 11 UK finance companies, all of which offer several different packages to suit the majority of applicants and their choice of vehicles. We have the facility to offer Lease Purchase (LP) and Personal Contract Purchase (PCP) for UK cars up to 3 years old subject to status of the applicant.

We supply a range of UK new cars to our customers direct from main UK franchised dealerships and all monies including deposits etc..are paid directly to them. All cars are UK specification vehicles and are supplied by UK Franchised dealers and all vehicles have the applicable UK manufacturers warranty. Our total on the road prices include 12 months Vehicle Road Fund Licence and in most cases onward delivery direct to our customer, alternatively customers may collect their new vehicles directly from our UK supplying dealer as a no extra cost, this comes with a full vehicle handover.

Car-Finance.net offer some of the best rates around for Personal Contract Purchase (PCP) please use one of our finance calculators if you wish to obtain a sample finance quote, we have several lenders offering superb rates and terms together with insurance products at very competitive prices, whether you require finance for a new or nearly new vehicle we have a product to suit.

PCP is one of the best ways to purchase a new car today, it allows customers to purchase a car of their choice at a very attractive fixed monthly finance payment, with the benefit of a low initial deposit outlay and a guaranteed minimum future value (GMFV) at the end of the agreement. PCP is particularly useful if you are a company car driver opting out of the company car scheme (Cash for Car), because you can use your company car allowance or mileage reclaims to fund your monthly PCP payments and avoid paying excessive company car taxes.

Typical APR 7.9%

Personal Contract Purchase provides the benefits of driving a higher specification vehicle for a lower monthly payment. Unlike the traditional car purchase plan, this is achieved by deferring a percentage of the total cost of the vehicle until the end of the contract which is known as the GMFV, then at the end of the agreement the customer has three options:-

Option 1
If you think the vehicle is worth less than the GMFV you can simply return it to the finance company. As long as the vehicle is in good condition and has not exceeded the agreed mileage, you have nothing more to pay. The finance company Guaranteed this future value and they will absorb the loss.

Option 2
If you want to keep the vehicle, you simply pay off the outstanding GMFV to the finance company.

Option 3
Thirdly, you can part exchange the vehicle with a motor dealer for your next new vehicle. If the trade-in value is greater than the GMFV, this sum can be used towards a deposit on the new agreement. Alternatively, you can sell the vehicle privately and keep any profit over and above the GMFV.

Excess Mileage
At the beginning of the agreement, you decide on the total mileage for the contract period and if you decide to hand your vehicle back to the finance company and your mileage exceeds the agreed mileage, you simply pay a fixed amount for every extra mile.

Wear & Tear
It is in your interest to minimize the vehicle's 'wear and tear' and not exceed the agreed mileage. When the agreement has finished, the vehicle may well be worth more than the GMFV, providing you with extra value. In simple terms 'normal wear and tear' means that for its age and mileage, the vehicle is in fair working order, condition and repair. A detailed guide will be provided to you by the finance company at the start of your agreement.

Lease Purchase is sometimes referred to as Hire Purchase with a balloon and is structured in a similar way to Personal Contract Purchase (PCP).

The customer will normally benefit from a slightly lower finance rate with a Lease Purchase product as there is no guarantee offered at the end of the agreement, the deferred capital lump sum amount at the end of the agreement is known as the Residual Value (RV), and this has to be paid by the customer for outright ownership. Deposits for Lease Purchase are flexible and are normally a minimum of 10% and a maximum of 50% of the total vehicle price, repayment periods are taken over 3 or 4 years typically.

The Residual Value (RV) (sometimes called the balloon) at the end of the agreement reduces the regular monthly payments accordingly, thus making vehicles that traditionally have a strong Residual Value (RV) more suitable for this type of product as they make repayments far more affordable.

The Residual Values (RV) is calculated and set at the beginning of the agreement and although this is not payable until the end. At the end of the agreement, there are realistically two options, 1. Pay off the residual value in cash or settlement by part-exchange or 2. Some lenders will allow the residual value to bemspread over a secondary period and be refinanced again.

Key Benefits to Personal Contract Purchase & Lease Purchase

• Lower deposits available.
• Cost effective rentals due to residual values.
• No tie to mileage contract.
• No lock in and settlement can be made at any stage of the agreement.

To buy a new car using Hire purchase finance is very similar to a bank loan, where you choose how much deposit to put forward or use your part exchange and make monthly repayments over a 2, 3, 4 or 5 year agreement. And at the end of the finance agreement you have brought the car and it's yours.