Work out the real monthly cost of a car on Hire Purchase or PCP. Enter the price, deposit, APR, term and any balloon payment, and see the monthly payment, total cost and interest at a glance.
Hire Purchase or PCP
Car finance spreads the cost of a car (less your deposit) across a fixed term. On Hire Purchase (HP) you repay the whole amount and own the car at the end. On PCP, a large optional final "balloon" payment is deferred to the end, so your monthly payments are lower — but you only own the car if you pay the balloon.
The calculator works out the monthly payment on the financed amount, accounts for any balloon left to the end, and adds the interest. A balloon reduces the principal you amortise each month but still accrues interest across the term.
| Hire Purchase | PCP | |
|---|---|---|
| Monthly cost | Higher | Lower |
| Final lump sum | None | Balloon payment |
| Own the car? | Yes, automatically | Only if you pay the balloon |
| Best for | Keeping the car | Changing every few years |
A personal loan lets you buy the car outright, so you own it from day one and can sell it whenever you like — sometimes at a lower APR than dealer finance. Compare both with the general loan calculator, and make sure the monthly payment sits comfortably within your take-home pay.
With a £2,000 deposit at 9.9% APR over 4 years on HP, the monthly payment is about £456, and the total cost including deposit is roughly £23,890 — around £3,890 of interest.
With HP you spread the full price and own the car at the end. With PCP a large optional final balloon payment is deferred to the end, so monthly payments are lower — but you only own the car if you pay the balloon.
A balloon is a lump sum due at the end of a PCP deal, based on the car's predicted future value. Pay it to keep the car, hand the car back, or put any equity towards a new deal.
Yes. You have the right to settle an HP or PCP agreement early and the lender must provide a settlement figure. You may save interest, though some early-settlement interest can still apply.
