Car Finance Pros and Cons

Make an informed decision when securing car credit with these car finance pros and cons

Oct 29, 2018

Buying a car on finance has become de rigueur for most. But if you’ve never done it before, it can seem baffling.

Each type of finance is usually suited best to a different situation. The most popular are PCP (Personal Contract Purchase) and HP (Hire Purchase). Leasing is also inceasing in popularity, although it;s not strictly car finance. It's also known as PCH (Personal Contract Hire).

In general, PCP is best for flexibility as it lets you decide at the end if you want to buy the car. HP is best for buying a car if you’ve made your mind up, and PCH is the cheapest way to get a new car on your driveway, as long as you’re not bothered about owning it.

Scroll down to see some more detailed pros and cons of each type of finance.

Monthly payments

Monthly payments

No-deposit option

Do you own the car?

Mileage charges?

Damage charges

PCP

Lower

Optional

*

*

HP

Higher

-at end

PCH

Lower

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