Car Finance Explained
If you’re new to the world of car finance then things can seem a little confusing to begin with. There are plenty of options when it comes to financing a new vehicle and going through them can feel overwhelming. However, there’s no need to worry as we’ve got all of the information to help you to make the right choice.
Here at Prestige Cars Kent we’re here to help you select the finance option which works best for you while answering any burning questions that you might have. So let’s dive in and check out just how car finance can work for you.
What is PCP Finance?
If you opt for PCP (Personal Contract Purchase), you’ll pay an initial deposit followed by regular monthly instalments. A large portion of the car’s value is left until the end of the finance agreement. Once you get towards the end of the agreement, you’ll have three options to either: buy it, part exchange the vehicle, or hand it back to us.
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What's HP finance?
If you choose HP (Hire Purchase), then you’ll pay a deposit upfront before paying off the rest of the car’s balance via monthly instalments. The benefit of an HP agreement is that you’ll own the car at the end of the agreement after you’ve paid an ‘option to purchase’ fee.
What's Lease Purchase finance?
Lease Purchase shares some similarities with Hire Purchase, but you’ll find that the monthly payments will be lower due to a final ‘balloon’ payment.
The difference between Lease Purchase and either Hire Purchase (HP) or Personal Contract Purchase (PCP) is that you aren’t able to return the vehicle at the end of the agreement. Instead, you’ll need to settle the balance remaining via a final payment, or by arranging another car finance agreement.
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