Finance for Used Vehicles

When buying a used car from Motors Coalville, you have the opportunity to buy with the knowledge that you’re always securing the best value for money possible. With used car finance available - notably, Personal Contract Purchase and Hire Purchase agreements - you will be able to spread the cost of purchasing over an agreed period of time, making investing in the car of your dreams as easy as can be. Learn more about the purchasing plans we have available now.

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Hire Purchase

  • Hire purchase (HP) is one of the most commonly used methods to finance motor vehicles.
  • The agreement is structured with fixed monthly payments and a final nominal “option to purchase” fee on payment of which, the customer takes legal ownership of the vehicle from the finance company. Unlike personal contract purchase (PCP), no “balloon” payment is payable at the end if the customer wants to own the vehicle.
  • If the customer has a large deposit to put down, HP may be a better option for a customer than PCP. 

Personal Contract Purchase

  • Personal Contract Purchase (PCP) is a type of hire purchase agreement (HP) which is often used by customers wanting to change or upgrade their vehicle on a regular basis.
  • The agreement is structured with regular monthly payments and a final “balloon” payment, being the estimated value of the vehicle at the end of the agreement, based on the agreed annual mileage and predicted wear and tear over the period. This is called the ‘Optional Final Payment’ (OFP), also sometimes referred to as the ‘Guaranteed Future Value’ or ‘GFV’.
  • At the end of the agreement, customers will have four options:  1  Pay the OFP and nominal option to purchase fee and own the vehicle outright;  2  Part-exchange the vehicle for a replacement.  Any surplus after paying the OFP could then be used as a deposit for a new agreement;  3  Hand back the vehicle (for example, where the OFP is more than its actual value). If the annual mileage agreed at the start of the agreement is exceeded or if the vehicle is not in reasonable condition on its return, this may incur extra costs.  4 Re-finance the OFP via a new loan arrangement so that the customer can spread the cost over a period to suit their monthly budget.
  • A deposit is commonly made with PCP but, for a larger deposit, HP may be a better option because the customer risks losing that “equity” in the vehicle if it is handed back at the end of a PCP agreement.
  • PCP monthly payments will be lower than for HP on equivalent terms.  But overall interest charges will be higher on a PCP because a portion of the credit advanced (in the form of the OFP) remains unpaid until the end of the term.

“We are a credit broker and not a lender. We can introduce you to a limited number of lenders and their finance products. We are not an independent financial advisor. We may advise you on the products, subject to your personal circumstances, though you are not obliged to take our advice or recommendation. We do not charge you a fee for our services. Whichever lender we introduce you to, we will typically receive commission from them (either a fixed fee or a fixed percentage of the amount you borrow). For your reassurance, all of the lenders we work with could pay commission at different rates, but the commission we receive does not influence the interest rate you will pay. Our aim is to secure finance for you at the lowest interest rate you are eligible for from our panel of lenders.”