What's the difference between a personal contract plan (PCP) and hire purchase (HP)?

With hire purchase (HP) you pay off the whole car and own it after the last payment. With a personal contract plan (PCP) the monthly payments are lower, because a big final payment is left to the end. You can pay it and keep the car, hand the car back, or trade it in.

How is the annual percentage rate (APR) worked out?

It's the yearly rate at which what you borrow equals the value of all your payments, counting each month as a twelfth of a year. It's given to one decimal place. Lenders must use the same formula, so it's the fair way to compare quotes.

Money

PCP or HP: check your car finance quotes

Check two car finance quotes, a personal contract plan (PCP) and hire purchase (HP): each interest rate and the total to own the car.

Self-assessment tool. The figures come from your own answers. It isn't advice, and you're responsible for what you file or claim. heypenny.ie is a trading name of Kinch Press. Read the disclaimer.

Common questions

What's the difference between a personal contract plan (PCP) and hire purchase (HP)?: With hire purchase (HP) you pay off the whole car and own it after the last payment. With a personal contract plan (PCP) the monthly payments are lower, because a big final payment is left to the end. You can pay it and keep the car, hand the car back, or trade it in.
How is the annual percentage rate (APR) worked out?: It's the yearly rate at which what you borrow equals the value of all your payments, counting each month as a twelfth of a year. It's given to one decimal place. Lenders must use the same formula, so it's the fair way to compare quotes.

Loading the calculator…