Finance at Ryders of Warrington
Ryders of Warrington Limited is authorised and regulated by the Financial Conduct Authority in relation to insurance distribution and consumer credit broking activities. (602228)
Ryders Of Warrington act as a credit broker working with selected lenders/a single lender and offer a wide range of flexible finance schemes to meet the needs of both our retail and business customers. Hire Purchase, Contract Hire and Finance Lease all offer the in-built flexibility to create a finance solution to meet your individual requirements.
Company number - 08402235, VAT Number 534986602. Registered Office Address: Ryders Of Warrington Ltd, Athlone Road, Warrington, Cheshire, WA2 8JJ
Financial Ombudsman Service’s website address – https://www.financial-ombudsman.org.uk
What is Personal Contract Purchase?
Monthly payments on a car financed by PCP are usually lower than if your car is financed by a Hire Purchase agreement. If you decide not to buy the car, you can simply walk away when you've made all the payments. Similar to PCH, you can drive away a new or used car every few years (dependent on the chosen term) without worrying about selling it on. If your car is worth more than the Guaranteed Future Value then you can use that equity towards a deposit on a new car.
If you want to buy the car you will need to pay your final balloon payment (the Guaranteed Future Value). Similar to PCH, you will need to agree on a mileage allowance at the beginning of your contract and there may be excess mileage charges if you exceed this. You won’t be able to sell the car without settling the finance. You won’t own the car until you have made all of your repayments.You’ll need to keep the car properly insured, maintained and in your possession until the full value is paid off.
You can normally settle your agreement early by asking the finance company to provide you with a settlement figure. However, the finance company will require you to pay off the difference between what your car is worth, and what you still owe and there may be a difference which is known as negative equity. On the other hand, you may find that at the end of your term your car is worth more than the Guaranteed Future Value, which means you will have some positive equity to contribute towards your next car.
You’ll be able to drive away a car that you may not have managed to buy outright. Unlike a PCP or PCH contract, you won't need to estimate your mileage at the start of your Hire Purchase agreement, so you'll avoid excess mileage charges. Once you’ve made your final monthly payment, including the option to purchase fee, you'll have full ownership of the car..
Monthly payments may be higher than some other finance options, such as PCP, as you're paying off the full value of the car. You won’t be able to sell the car without settling the finance. You won’t own the car until you have made all of your repayments. You’ll need to keep the car properly insured, maintained and in your possession until the full value is paid off.
The short answer is yes, you can end your finance early. There are different provisions within each finance agreement that allows you to do just that. If you have got through two-thirds of the way through your finance agreement, the options to end the finance agreement early open up. For a Hire Purchase agreement, there is an option of paying it off early through a settlement fee. A settlement fee covers the cost of any remaining unpaid instalments and interest payments remaining on the agreement. Once the settlement fee is paid, you take full ownership of the car early. Under a Personal Contract Purchase agreement, you can also pay a settlement fee for bringing the agreement to an end early. After that, you can choose to hand the car back or you have a second option. Through a PCP agreement, you can take full ownership of the car by paying off the remaining Guaranteed Minimum Future Value also known as a balloon payment.