PCP Car Finance To Suit You

Rates from 10.9% APR. Representative APR 19.9%

Audi A1
CAR FINANCE SOLUTIONS

PCP Car Finance.

Before we go into PCP finance, it’s necessary to understand what it is and how it works.

PCP car finance (Personal Contract Purchase) is a type of car loan agreement that allows you to buy a vehicle. It typically lasts between three and five years. The distinction between PCP finance and HP finance when purchasing a car is that the loan does not cover the entire cost of the vehicle. 

Because you will not own the car after you make the final payment. Unless you want to make an additional optional final repayment. The payment is then recalculated with GMFV. Guaranteed Minimum Future Value (GMFV) is an estimate of the value of your car at the end of a PCP contract. This, however, is frequently reflected in lower monthly costs. We will compare PCP auto financing rates to find the ideal vehicle and the ideal PCP car finance price for you.

Advantages of PCP Car Finance.

  • You make lower monthly payments
  • Your contract has flexible outcomes
  • You only have to pay the guaranteed future value

Disadvantages of PCP Car Finance.

  • You will need to make additional payments at the end of your contract if you wish to keep the car
  • You will need to stick to your mileage agreement, otherwise, there are financial penalties when you return the vehicle
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PCP Car Finance

0% Finance Options Available.

APR financing rates vary for each car dealership. Because fantastic PCP car finance options are sometimes limited to a specific car manufacturer. Your credit score also affects the interest rate. APR interest rates for finance applicants with good credit range from 4 to 8 percent (approximate). For candidates with bad credit, APR interest rates could reach up to 50%. In addition, if you have a big deposit on the vehicle, you may be able to obtain 0% financing. 

Our Financial Background.

Every day, people buy cars. However, what works for one person may not work for another. PCP auto financing is, of course, one possibility. However, there are various other financing choices available, so it is crucial to consider all of your options. If you want to own the car at the end of your car finance contract without having to pay the balloon payment. A HP car loan may be a more appealing alternative. Because you will be able to own the vehicle as soon as you have made all the repayments.

Payment History
35%
Amount You Owe
30%
Length of Credit History
15%
New Credit Opened
10%
Type of Credit
10%

Credit Score Breakdown.

What Factors Affect Your Credit Score?

Financial well-being is strongly influenced by people’s credit scores. Your credit score is a measure of your financial responsibility. The higher your credit score, the better your chances of getting car finance with lower interest rates, and other benefits. Having a low credit score may prevent you from qualifying for a car loan that you may want, or your interest rate for borrowing will be higher than those who have excellent or good credit.

If you seek advice on how to improve your credit score or simply require more information, please visit: Ultimate Guide to Credit Scores

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Rates from 10.9% APR. Representative APR 19.9% Representative Example: Borrow £6,000 with £1,000 deposit over 48 months with a representative APR of 19.9%, the monthly payment would be £182.26, with a total cost of credit of £2,748.61 and a total amount payable of £8,748.61. Car Loans UK is a broker not a lender. This is an example only, all finance subject to status. Lender fees may apply

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Rates from 10.9% APR. Representative APR 19.9%

Frequently Asked Questions.

Why use Bright Motor Finance for motor finance?

At Bright Motor Finance we have many lenders on our panel, so we can make sure you are getting the best motor finance deal for you. Plus, we do all the admin, paperwork and negotiations with the dealer.

What is the difference between HP & PCP?

HP and PCP car finance are fairly similar to one another. However PCP tends to have lower monthly repayments. Although that the full amount that will need to be repaid is generally higher than with hire purchase.

PCP works by having a loan for the difference of the vehicles price when it is brand new, and the anticipated vehicle value when the agreement has been completed. This is because the vehicle will of course, depreciate over time.

HP works by usually paying a deposit of around 10% of the cars initial value, and then this value will be paid off in fixed monthly instalments. Car dealers as well as brokers (such as ourselves) can arrange a hire purchase finance agreement.

Can I change my mileage on PCP contracts?

In a nutshell, the answer is no.

This is because the car’s resale value has already been calculated once you’ve signed your PCP car loan contract. It is crucial to know that exceeding your agreed-upon mileage allowance will result in additional penalties at the end of your PCP contract.

What is a car finance brokerage service?

In essence, a car finance broker acts as a middleman between the customer and the lender. A car loan broker handles all the paperwork and negotiates with lenders on your behalf. By doing this, you can rest assured that the broker is fighting for you to get you the best deal. Our goal is to make your car finance journey as simple as possible. As well as this, car finance brokers such as ourselves have deals that aren’t usually available to the general public. Instead of charging the customer, car finance brokers charge the dealerships.

How does car finance affect my credit score?

Initially, asking for a car loan will typically have a negative impact on your credit score due to the intensive credit checks that lenders will perform. You should be aware, however, that if you make your car finance instalments on schedule. This will almost certainly improve your credit score.

What if I have been refused by other brokers?

There is still hope even if other brokers have rejected you in the past. We offer a number of finance options for those with bad credit scores at Bright Motor Finance. We will conduct a hard credit check when you apply for car finance through us, which may negatively affect your credit score. Especially if they were conducted within a short period of time. As a result, it is recommended that you wait between 3-6 months before applying for car finance again after being declined.

Can I alter my car if I finance it?

You can, but you must first obtain authorisation from the financial firm before making any changes.

What if I’m struggling to make payments?

Having trouble making your car finance payments? You have a number of options available to you. One of the following charities/organizations can provide you with free, independent advice. 

What is APR?

The annual percentage rate (APR) is the total amount charged for the loan. APR, on the other hand, comes in two varieties. Exact APR implies that the rate displayed to you is the rate you will receive. Representative APR, on the other hand, suggests that 51 percent or more of those who apply for financing will receive that rate. This means that customers with weak credit may face a higher APR.

Representative APR is commonly used to advertise a company’s rates. After you have provided the lender with all of the essential information, they will be able to provide you with your specific APR rate.

GAP insurance and do you need it?

What exactly is it?

Gap insurance is an abbreviation for Guaranteed Asset Protection.

Gap insurance is a type of insurance that is meant to cover the difference between the amount your insurance provider pays out in the event that your car is written off or stolen and the price you paid for the vehicle. However, you should be aware that gap insurance supplements, not replaces, your usual car insurance.

So, when do you need gap insurance?

Gap insurance can be beneficial in a variety of ways. First and foremost, if you took out a large loan to purchase your car. As previously said, gap insurance would be advantageous if your automobile was stolen or written off. This is due to the fact that the gap will pay off the existing debt.
Furthermore, gap insurance may be advantageous if you are concerned about the depreciation of your vehicle. In the first year, a brand new car will lose 15-35 percent of its value. As a result, gap insurance might assist you in receiving a larger reimbursement if your automobile is written off after it has already depreciated.

What Happens If There Is An Issue With The Vehicle?

If the vehicle is defective upon delivery, you can simply refuse it and return it to the dealership.

What affects the cost of my car finance payments?
  1. Your deposit size
  2. How long your car finance agreement will last
  3. The interest rate
  4. What car do you choose?
How do I know that PCP finance is right for me?

Ask yourself these questions:

Will I want to keep the car?

Will I want to keep the car for a long while after?

How are my finances and credit score looking?

How far will I be driving each month?

What can I afford?

Is PCP the right choice for you?

PCP car finance is comparable to a hire purchase contract. However, the monthly payments with PCP are typically smaller. However, keep in mind that the total sum payable is usually larger.

PCP works by providing a loan for the difference between the car’s current price and the expected value once the agreement concludes. Furthermore, over the contract time, the anticipated mileage gets applied.

Do you want to keep the car?

PCP finance is one of the more complex car financing options available. However, along with HP vehicle finance, it remains one of the more popular options. For people who may not want to keep the vehicle at the end of their auto financing contract, PCP may be an appealing choice. PCP gives you the most flexibility at the end of your agreement. You can choose to return the car, exchange it for another contract agreement, or make one final ‘balloon payment’. This payment allows you to keep the car at the end of your contract.

 

It can be quite confusing, but there are three elements of the loan to keep in mind when you’re deciding if this is the right type of loan to help you to buy a car.

Because many car dealers who offer you PCP car finance deals will expect you to pay a 10% deposit. Although occasionally there may be incentives from the manufacturer to entice you, such as a deposit contribution. This is sometimes up to £2000 and is only available if you use their finance option. Also, as with any other loan, the bigger your deposit, the less you’ll need to borrow and the less interest you’ll pay and in turn, opening yourself up to better PCP car finance deals.

Then the amount that you will need to borrow will be calculated based upon the depreciation of the car’s value across the length of your loan term. Then the deposit you put down is deducted from this amount. So, you’ll pay off the amount they calculate, minus your deposit but plus interest, in monthly payments for the length of your loan agreement. PCP agreements include the APR, because it takes into account the interest charged on the outstanding balance and any other fees associated with the loan agreement. Furthermore, a loan agreement lasts for 24 to 48 months and the interest added is usually from 4% upwards.

If you decide that you want to own the car outright at the end of the deal, you can make a final balloon payment. This is also called a GFV or Guaranteed Future Value amount. Then this is calculated according to the amount that your car is anticipated to be worth at the end of your loan agreement. Of course, this is entirely optional, but the amount they set is not usually negotiable.