Car Finance Explained
Choosing a finance solution to suit you:Financing a vehicle is a popular way in the UK to buy a new or used vehicle. It provides the flexibility of purchasing a vehicle, without having to pay a large lump sum of cash upfront.
At Inchcape we have a great selection of finance options for you to choose from. These include:
- Personal Contract Purchase (PCP)
- Hire Purchase (HP)
- Personal Contract Hire (PCH)
- Business Contract Hire (BCH)
For more information about the finance options available, please read the “Private Car Finance Options” section below.
All finance applications will be subject to credit checks and affordability assessments carried out by our lenders based on the information you provide us. Please ensure you can afford to repay any loan you request that we arrange on your behalf.
Inchcape are FCA regulated and act as a broker not a lender, we work with a panel of lenders and we will receive commission for arranging finance on the customer’s behalf. We do not advise or recommend finance products, but will provide information to allow our customers to make an informed choice.
Private Car Finance Options
Personal Contract PurchasePCP plans are designed for people who like to change their vehicle regularly. So it means you could drive a new vehicle every 2-3 years.
How does PCP work:
Personal Contract Purchase is one way to buy a new, nearly new or used vehicle. It combines fixed monthly payments with exceptional flexibility at the end of the agreement. Typically this is available between 18 and 49 months.
At the end of your PCP agreement:
You have total control in deciding which of these choices suits you best.
Return - You have the option to return the vehicle at the end of your agreement. To avoid incurring charges, the vehicle needs to be in good repair and condition (allowing for fair wear and tear) and within the permitted maximum mileage as agreed upfront on an annual basis.
Retain - Buy the vehicle outright by paying the optional final repayment. An option to purchase fee of £10 is also applicable.
Renew - Subject to paying off your existing agreement in full, you can part exchange your vehicle at the end of the term or any time during the agreement. Alternatively the vehicle could be worth less than the optional final repayment leaving you with a shortfall to pay before starting a new agreement. In such instances, you can exercise the RETURN option above and have no further liability (mileage and vehicle condition restrictions apply, as above).
Is PCP the right finance option for you?
A cost effective and flexible way to change your vehicle on a regular basis.
Discover more about how to finance your new vehicle with our Guide to PCP Car Finance.
Personal Contract HirePCH is a fixed cost rental agreement, available on selected new vehicles only.
How does PCH finance work?
The amount you pay per month covers the drop in your vehicle's residual value over the length of the lease. An initial rental is needed, this will typically be equal to between 1 to 12 of your monthly rentals, but can also be a lump sum payment.
At the end of the PCH agreement:
A PCH agreement normally runs between 24 - 60 months. Once this comes to an end the customer simply returns the vehicle, subject to condition and mileage.
Is PCH the right option for you?
PCH can be a cost-effective way to keep yourself in a new vehicle. You don't need a big deposit and road tax is covered for the duration of your contract.
Discover more about how to finance your new vehicle with our Guide to PCH Car Finance.
Hire PurchaseHP is one way of buying a new, nearly new or used vehicle. The monthly payments are determined via the amount of deposit initially paid, the period of the contract and the overall price of the vehicle.
How does HP finance work?
A HP option will consist of paying a deposit amount, and you will then pay the remaining balance and interest in equal monthly repayments over the agreed term. This will entitle you to eventual ownership of the vehicle. There are no mileage restrictions.
At the end of your HP agreement:
After you’ve made all the repayments including any interest and option to purchase fee, you will become the owner of the vehicle and are free to keep or dispose of the vehicle as you see fit. Should your circumstances change you are able to settle the agreement either partially or in full, and your finance company will be happy to provide a figure for this at any time.
Is HP the right finance option for you?
If you're a high mileage driver or would like to keep your car for a longer period of time, HP could be an option for you.
Discover more about how to finance your new vehicle with our Guide to HP Car Finance.