The difference between PCP and HP
Are you looking to buy a new car, but you're unsure about the difference between PCP and HP. Here at Atlas Autos our experienced team are here to help you buy your used car in Colchester. Our extensive knowledge and experience can come in handy, we can tell you all there is to know about your new car.
Here at Atlas Autos our showroom is full of a huge range of cars for you to choose from. Why don't you come on down and take a look, our team will be here to answer any questions you may have. It's really important for you to see the car and take it for a test drive before you make the purchase. We offer the chance for you to take any of our models for a spin, this will give you a greater understanding of the car when you buy it.
What is PCP?
Personal contract purchase is a finance option we offer here at Atlas Autos. This is best suited to those of you who like to regularly change your car with a low monthly cost for finance. This flexible deal can suit you and your budget, for more information call us today to find out all there is to know about PCP.
This finance option is a loan to help you get a car, you're not paying back the full amount of the vehicle and you won't own the car at the end of the lease. This is ideal if you're looking for a new car for a few years and you enjoy regularly changing your set of wheels. This option can be split into 3 main parts...
1. The deposit:
This is usually around 10% of the vehicle's overall price but this can vary depending on the dealership you go to. The more money you pay upfront, the less you will have to borrow and pay off each month.
2. The amount you borrow:
The finance company will predict the value of the car once the lease has ended, from here they will put together a sum of money which you will borrow and pay off each month plus interest. Over time, cars lose value due to their age and the amount of miles they have done.
3. The Balloon payment:
At the end of the lease there is the option for you to pay the difference of the guaranteed minimum future value of the car you have on finance. In some agreements, at the beginning of the finance agreement some people choose to keep the car at the end, some choose to take out finance on a different car. This depends on each individual.
Benefits of PCP
- Fixed monthly payments.
- Deposit is low.
- Fixed option payment when you first take out the finance.
- Option to refinance the final payment.
What is HP?
Hire purchase finance is another option we offer here at Atlas Autos. If you're looking to own your car at the end of the lease, this is the most cost effective way for you to finance your car.
The difference here is that you pay the initial installment for the deposit, this is usually 10% of the car's value. From here monthly installments will be spread over 5 years, in this time you will repay the money you have loaned plus interest. This is the best option if you wish to own your car at the end of the agreement.
Benefits of Hire Purchase finance
- At the end of the agreement you will own the car outright.
- The interests are lower than PCP finance.
- There are no mileage limits as you will own the car at the end of the lease.
- Flexible term lengths to suit your financial situation, this can be between 1-5 years.
For more information about used cars in Ipswich, contact our experienced team here at Atlas Autos. We want to help you purchase your ideal car today! Come on down to our showroom we have a huge range of used cars for sale for you to choose from.