Finance Methods Finance Types - Explained
Entering into a car finance contract is an important decision, so you need to know what options are available, and that you fully understand how each option works.
The three most popular finance contracts available are Personal Contract Purchase (PCP), Hire Purchase (HP) and Personal Contract Hire (PCH).
Perhaps the most popular type of car finance, Personal Contract Purchase is also the most flexible, giving you several options come the end of the contract.
Of the main choices of car finance deals available, Hire Purchase is the traditional option. Although not as flexible as a PCP deal, Hire Purchase does guarantee ownership of the car at the end of the finance agreement.
If you’ve no interest in owning your next car, then Personal Contract Hire might be the best car finance option for you. It’s also a suitable car finance deal if you don’t want to worry about depreciation or interest costs. This is a rental agreement and not a purchase agreement.
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