Buying on finance: HP and PCP
The lender sets this from the car's expected value and your mileage. Leave at 0 to see HP only.
Needed to compare buying with leasing: if you buy, you are left with a car worth this.
Leasing: PCH quote
A "6 + 47" quote over 48 months means an initial rental of 6 months, then 47 rentals.
| Figure | HP | PCP | PCH (lease) |
|---|
Correction, 4 October 2026: before this date the PCP figures on this page charged no interest on the deferred final payment, which understated PCP monthly payments and interest by a large margin (for a £20,000 car, £2,000 deposit, 9.9% APR, 48 months and £8,000 final payment: £253.15 a month and £2,151 interest, instead of £314.30 and £5,087). Both HP and PCP now also convert the APR to a monthly rate as an annual effective rate. How the figures are worked out.
Frequently asked questions
What is the difference between HP, PCP and PCH? â–¼
With hire purchase (HP) your monthly payments repay the whole amount borrowed, and the car is yours after the last payment. With PCP, part of the amount borrowed is deferred to an optional final payment (the guaranteed minimum future value), so monthly payments are lower; at the end you pay it and keep the car, or hand the car back. With personal contract hire (PCH, leasing) you rent the car for a fixed term and always hand it back.
How is a PCP monthly payment calculated? â–¼
The amount borrowed is the car price minus your deposit. Interest is charged on the whole balance, including the deferred final payment, at a monthly rate of (1 + APR)^(1/12) − 1. The monthly payment is the level amount that, with that interest, leaves exactly the final payment outstanding at the end of the term.
Which is cheaper — HP, PCP or leasing? ▼
It depends on the figures. At the same price, deposit, APR and term, a PCP has lower monthly payments than HP but more interest if you pay the final payment, because more of the balance stays outstanding for longer. Leasing has no interest figure because you never own the car, so compare its total cost with the cost of buying minus what the car would be worth at the end. Enter your quotes to see your own numbers.
What is the GMFV (guaranteed minimum future value)? â–¼
It is the lender's estimate of what the car will be worth at the end of a PCP, based on your agreed mileage, and it sets the size of the optional final payment. If the car is worth more than the GMFV at the end, the difference is equity you can put towards your next car.
What does a PCH lease quote like '6 + 35' mean? â–¼
It means an initial rental equal to six monthly payments, followed by 35 monthly rentals. Enter the number of months in the initial rental and the number of rentals after it, and the calculator works out the total cost including any fee and expected excess-mileage charges.
Should I use dealer finance or a personal loan? â–¼
Compare the total amount payable. Dealer promotional APRs can be low but are usually limited to new or nearly new cars. With a personal loan you own the car from day one, which matters if you want to sell or modify it.