PCP (Personal Contract Purchase)
PCP allows you to pay a variable deposit, defer part of the cost of the car into an optional balloon payment, then spread the remaining cost over a series of monthly payments. It also gives you the flexibility of keeping the car or handing it back at the end of the contract. A PCP can also be combined with an optional all-inclusive maintenance and breakdown package if required. There are 3 elements:
Initial Deposit - from £0 up to a maximum of 40% of the purchase price (depending on lender) and is the amount you agree to pay the Dealer as a down payment for the car. You�ll be asked to pay this amount to the Dealer a few days before taking delivery, less any holding deposit you paid to the Dealer when you initially placed the order.
Residual Balloon - a fixed amount calculated based on the length of finance contract (12-48 months) and the mileage you cover. This is the amount you will need to pay the finance company at the end of the contract IF you wish to keep the car. It may also be referred to as a Guaranteed Minimum Future Value (GMFV).
Monthly Payments - calculated by taking the amount you are borrowing (i.e. the cost of the car less deposit) adding the interest and then subtracting the Residual Balloon. The resulting figure is then divided by the number of months you financing the car over. You can adjust the deposit amount to reach the monthly figure you are comfortable with. The higher the deposit the lower the monthly payments and vice versa.
At the end of the PCP contract you have 3 choices:
We are working to bring on board a variety of lenders to offer favourable lending rates on personal loans to Motorlogix customers. In the meantime, if you are looking to borrow money to buy your car outright then our team will be happy to recommend various lenders who may be able to assist you.