Car Finance is becoming increasingly common, more and more people use a variety of options to buy their car rather than pay up front.
There are a few options you can choose when it comes to finance; Hire purchase, Personal contract purchase and Lease purchase. All of these options are different and depending on circumstance one of them will be right for you, call one of the team today and find out which ones right for you.
Hire Purchase also known as HP is a simple way to finance your vehicle. You’ll get the security of knowing you have a fixed interest rate along with fixed monthly payments throughout the contract. The structure of the deal can vary depending on your initial deposit and repayment period, each can change to help you achieve your budget and the length of time you want to be making the payments. The initial deposit can be accepted in the form of a cash payment or trading in your exciting car.
How it works
Once you’ve found the car you want and have decided that a hire purchase is right for you, we’ll help structure your perfect deal. To do this we take into consideration you available deposit, agreement duration and monthly budget. Your initial payment along with your monthly payments over the term will fully pay for the car, interest and fees. Meaning once the term ends the car is yours.
Personal Contract purchase commonly known as PCP. This is the most common way people purchase cars in the UK. The end of the contract includes a balloon payment to pay off and purchase the car, this payment allows for your monthly payments to be reduced. This Balloon payment is known as the optional final payment and the guaranteed future value. This payment will be close to the expected value of the car at the time.
When your PCP deal is coming to an end...
Once your personal contract purchase deal is reaching its maturity you have you have a number of options.
Trade your vehicle in for a new deal, any equity built up in your current car can be used as a deposit on your next one.
Pay the balloon payment at the end and keep the car.
Refinance the balloon payment to keep the car and pay it off over time.
Return your vehicle with nothing left to pay, subject to vehicle condition and agreed mileage limits.
This is a flexible way to buy your car, regularly used for business buyers as well as private individuals. The contact can be structured around your deposit and repayment periods, it can also be accompanied by a final lump sum balloon payment if you want to keep your monthly payments down. This balloon payment is calculated on the anticipated value of the car at the end of the agreement.
What to do next...
When your deal is coming to an end you have a number of options.
Pay any final payment you have left and have the car transferred into your name.
Swap the car in for a new deal, this is subject to the settlement of the current agreement.
Refinance the balloon payment and keep the car.
Flexible deposit and term
No mileage restrictions, however, balloon payment is based on anticipated future mileage
Car Genie is a trading style of GW Auto Solutions LTD, is authorised and regulated by the financial Conduct Authority (FRN:919581). We act as a credit broker not a lender. We can introduce you to a limited number of lenders who may be able to offer you finance facilities for your purchase. We will only introduce you to these lenders. We may receive a commission payment from the finance provider if you decide to enter into an agreement with them.