![]() ![]() Always compare the monthly amounts on your PCP contract, you may be better off buying a new car rather than a used car. PCP Interest rates on used cars are typically not as good as the interest rates provided on new cars. You will have to pay the future value amount at the end of the PCP contract if you wish to keep the car you financed. PCP loans do not give you ownership of the car, you are simply in a financial contract for a fixed period with a car dealership. This is a key point when you don't intend to keep the car at the end of the PCP loan contract. We all love a bargain but question those eye catching monthly repayment plans.Īs PCP loans are calculated on the future value of the car, the best deals are on cars which retain their value. Keep an eye out for 0% car finance deals, this is where you typically get the best car finance deals. PCP loans can be a great way of financing your new car but shop around first and talk to the car dealership. In this example you pay no deposit on your new BMW so the PCP loan will be for £17,000.00 (that's £30,000.00 minus £13,000.00.Ĭlearly that is a very simple PCP explanation, most loans and finance attract administration fees and you may be putting a cash deposit down or receiving a dealer contribution which will affect your PCP loan amount and monthly loan repayment calculations. The BMW dealership provides you a residual value (commonly called Guaranteed Future Value) of £13,000.00. Imagine you are looking to take a PCP loan on a new BMW at £30,000.00. Example of PCP Loan - BMW PCP Finance example The car finance is then calculated based on the value of the car now minus the residual value. ![]() PCP financing is based on the car's residual value, that is the value that the car is worth at the end of the contract. PCP loans provide relatively low monthly repayments and make car finance very affordable. Auto loan calculator to find monthly payment, total in payments and total interest for an auto loan. Create a loan amortization schedule and payment tables for loans. PCP (Personal Contract Purchase) is a type of car loan. Calculate your monthly car payment based on loan amount, term and interest rate. Always check the small print of your car finance loan agreement to ensure there are no hidden charges or caveats that affect the final valuation figure. So, shop around, PCP deals are not all the same. We have also identified that PCP loans vary between car dealerships based on the number of decimal places to which they apply their calculations, these varying approaches can provide stark differences to the amount you repay each month with PCP and the total amount you repay over the full term of the PCP agreement. Our car loan calculator Australia can also give you an idea of what a loan could cost you.This PCP loan calculation is for illustration purposes only and the figures may alter dependent on the PCP finance plan for your car finance. You can do this for free through one of the main Australian credit bureaus: Equifax, illion and Experian. After you’ve decided on your preferred lender, and we’ve made sure you’re likely to be approved, we’ll then submit your application to the lender who will run a full credit check.īefore you start applying for loans, it’s a good idea to check your credit score and review your credit history. This means we can access the score that lenders will use to price your loan, without recording an enquiry on your file or impacting your credit score. For other lenders, your credit score isn’t the most important factor, and they’ll consider things like your income, age of the vehicle and employment status when assessing your application.ĭriva runs a ‘soft credit check’ when you apply for your personalised quotes. In many cases, the higher your credit score, the lower interest rates you’ll be eligible for. For many lenders, your credit score will have a big impact on both your eligibility for a loan as well as the rate you’re charged. Each lender has different eligibility criteria, so it’s tricky to say. ![]()
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