Personal Contract Purchase - Your Questions Answered

Here's a selection of frequently asked questions and concerns raised by Customers when considering Personal Contract Purchase as a funding method

So, what you're telling me is I'm renting the automobile for three years?

Well, it's really the same as the Hire Purchase Agreements you may have taken out in the past, until the agreement is paid in full, ownership of the vehicle is not passed to you. The benefit of PCP is the same, without the uncertainty and with more flexibility

I always but my cars on Hire Purchase, I like to own them

See above

But will I ever own the automobile?

Yes, you can own the car if you decide to do so at the end of the agreement by paying the deferred final payment

What would happen if my car was not worth the value set by 'the manufacturer'?

You can return the automobile to the Retailer, and within the terms of the agreement, you can simply walk away

What if my car is worth more than the value set by 'the manufacturer'?

You can part exchange it and use the difference towards your new car

What happens if I cannot afford to pay the end value?

PCP gives you three ways to pay your deferred final payment:

You can part exchange the car for a new car using any difference as a deposit

Hand the keys back and walk away

Keep the car by refinancing the deferred final payment

Can I change my car early?

Yes, and many Customers do

What happens if I exceed the agreed mileage?

If you part exchange the car the Retailer will simply adjust the allowance to take in to account the difference in mileage

What happens if I'm off sick - how would I afford the repayments?

Most Retailers offer payment protection to qualifying Customers and your payments could be made for you in the event of accident and / or sickness

I only drive 5,000 miles per year - is PCP still a good idea?

A well cared for car with lower mileage is always in demand and worth a lot more, and also helps reduce your monthly payment

If you have a question about Personal Contract Purchase that is not covered here, please feel free to post it here and I'll respond as soon as possible

As always - thanks for looking!

Stephen

About the author:
Stephen Turner has worked within the Motor Industry for over twenty years and is the founder of TOP Training Solutions, a specialist organisation which provides award winning performance improvement systems for the Motor Industry

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