Personal Contract Purchase (or PCP) has emerged as a popular alternative to Hire Purchase (HP) over recent years. The key difference between a PCP and an HP is that with a PCP the projected future value of the car at the end of the agreed term is calculated at the start of the finance agreement and this value is deferred and usually referred to as a Guaranteed Minimum Future Value (GMFV). The GMFV will be determined by a number of factors including; how old the car will be at the end of the agreement and your anticipated annual mileage. The future value of the car is guaranteed by the finance company so will not fluctuate.
A PCP agreement gives you the flexibility to decide whether you would like to own the car at the end of the finance agreement by paying the GMFV or instead return the car to the finance company. It has lower monthly payments during the term (compared to a hire purchase agreement) due to the deferral of the optional final payment at the end of the agreement but will require you to pay a larger final payment at the end of the agreement if you decide to keep the car.
Those looking for flexibility at the end of their finance agreement.
Jardine Motors Group is a credit broker and not a lender and is authorised and regulated by the Financial Conduct Authority for credit-related regulated activities and insurance distribution activities.
We work with a number of carefully selected credit providers who may be able to offer you finance for your purchase. Each of these finance companies will have their own deposit requirements, interest rates and terms and conditions, including those relating to status and affordability, and it is important that you consider these carefully when discussing your options. They pay us a fixed commission for introducing you to them, if you would like further information please email firstname.lastname@example.org before you enter into your finance agreement.
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