PCP vs HP — see them side by side
Set the price, deposit and term. We'll calculate both finance types at the same indicative APR so you can see exactly what's different.
Illustrative — real GMFV depends on model, mileage and lender.
Hire Purchase
£516/mo
Total payable
£26,765
Total interest
£4,765
- You own it at the end
- No mileage cap
- Higher monthly than PCP
PCP
Lower monthly£387/mo
Total payable
£28,288
Total interest
£6,288
Final balloon
£7,700
- Lower monthly payments
- Flexibility at the end
- Balloon due to own the car
Illustrative only — not a personalised quote. Your actual rate depends on lender, credit profile and vehicle. WeCarFinance is FCA regulated.
Frequently asked
What's the fundamental difference between PCP and HP?
Hire Purchase (HP) spreads the whole car price over the term — you own the car at the end. Personal Contract Purchase (PCP) defers a large chunk (the balloon or GMFV) to the end, giving you lower monthlies plus a choice: hand the car back, pay the balloon to keep it, or part-exchange.
Why is my PCP monthly lower than HP for the same car?
Because on PCP you only finance the depreciation between the OTR price and the guaranteed minimum future value. HP amortises the full price. The trade-off is you don't own the car until you pay the balloon.
Is one cheaper overall?
HP usually costs less in total interest if you keep the car for the full term. PCP can be cheaper if you always want a new car every 3–4 years and hand back at the end — you're only ever paying for the depreciation you actually use.
How is the GMFV / balloon set?
The lender predicts what your car will be worth at the end of the term based on the model, term length and annual mileage. Higher mileage = lower GMFV = higher monthly payments.