Car Gear Shift

Car Finance

Hire Purchase
(HP)

  • The most popular type of car finance and easy to understand.

  • Borrow an amount of money secured against the vehicle, plus any interest, over a set period of time.

  • The car is yours at the end of the term.

Personal contract purchase
(PCP)

  • Pay off the car’s depreciation value, instead of making payments towards the full price of the car.

  • For example, if the car you buy costs £15,000 and it’s expected to be worth £10,000 when your term ends, then your payments will be based on the depreciation of £5,000.

  • You can buy the car outright at the end with a balloon payment, Hand it back or exchange it for newer car.

Personal Loan

  • The only finance type that isn’t secured against the vehicle itself.

  • Loan an amount of money from a provider and use that to pay for the car. You will pay that money back through regular monthly installments plus any interest.

  • You will own the car from day one.

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