Work out your HP or PCP monthly payments and total cost of credit before you sign — all free, no sign-up required.
Free calculators to help you understand the true cost of financing a car in the UK.
Most new and used cars in the UK are bought on finance. The two most popular options are Hire Purchase (HP) and Personal Contract Purchase (PCP). Understanding the difference before you visit a dealership can save you thousands of pounds.
HP is the simplest form of car finance. You pay a deposit, then make fixed monthly payments over the agreed term. At the end, you own the car automatically — there is no balloon payment and no decision to make. HP payments are higher than PCP because you are paying off the full value of the car, but the total cost of credit is usually lower.
PCP offers lower monthly payments because you are only financing the difference between the car's purchase price and its predicted future value (the "balloon" or Guaranteed Minimum Future Value). At the end of the agreement you choose: pay the balloon to own the car, hand it back, or use any positive equity as a deposit on a new PCP deal.