PCP Finance Calculator
Your PCP Finance Breakdown
Amount Financed-
Monthly Payment-
Total Monthly Payments-
Balloon / GFV-
Total Interest Paid-
Total Amount Payable-
PCP vs HP vs Lease — Comparison 2026
| Feature | PCP | HP | Personal Lease |
|---|---|---|---|
| Monthly Payments | Lowest | Higher | Low–Mid |
| Own Car at End? | Optional (pay GFV) | Yes (automatic) | No |
| Balloon Payment | Yes | No | No |
| Mileage Limits | Yes (excess charges) | No | Yes (excess charges) |
| Typical APR 2026 | 3.9–9.9% | 5.9–10.9% | N/A (rental) |
| Voluntary Termination | After 50% paid | After 50% paid | Not applicable |
| Best For | Changing cars often | Keeping the car | Business users |
Example PCP Deals — £25,000 Car
| Scenario | Deposit | Term | APR | GFV | Monthly | Total Cost |
|---|---|---|---|---|---|---|
| Low deposit | £1,000 | 36m | 6.9% | £10,000 | £451 | £27,236 |
| Standard | £3,000 | 36m | 6.9% | £10,000 | £388 | £26,968 |
| Large deposit | £5,000 | 36m | 6.9% | £10,000 | £325 | £26,700 |
| 0% promo | £3,000 | 36m | 0% | £10,000 | £333 | £25,000 |
| 48 month | £3,000 | 48m | 6.9% | £8,000 | £319 | £26,312 |
How PCP Finance Works
1
Choose your car and agree a price
The on-the-road (OTR) price is the starting point. Negotiating the price down reduces your monthly payments and total cost.
2
Pay your deposit
A larger deposit means lower monthly payments and less total interest. Dealer contributions count towards this.
3
Make monthly payments
You pay off the depreciation (the difference between the car price minus deposit and the GFV) plus interest over the agreed term.
4
End of term: three options
Hand the car back, pay the balloon (GFV) to keep it, or use any equity as a deposit on a new PCP deal.
Tip: Always negotiate the car price, not just the monthly payment. Dealers can manipulate the deposit, term and GFV to hit any monthly figure while increasing the total cost.
Frequently Asked Questions
How is a PCP monthly payment calculated?
A PCP monthly payment is calculated on the difference between the car price (minus your deposit) and the Guaranteed Future Value (GFV/balloon payment). This amount is financed over the term at the agreed APR. For example, on a £25,000 car with £3,000 deposit and £10,000 GFV over 36 months at 6.9% APR, you finance £12,000 plus interest, giving monthly payments of approximately £380.
What is a good APR for PCP car finance in 2026?
PCP APR rates in 2026 typically range from 0% (manufacturer-subsidised deals on new cars) to 12% or more (used cars, lower credit scores). A competitive rate for a new car is 3.9–6.9% APR. Used car PCP deals are usually 7–10% APR. Your personal rate depends on your credit score, the car age, and the lender.
What happens at the end of a PCP deal?
At the end of a PCP agreement you have three options: (1) Hand the car back with nothing more to pay (subject to mileage and condition), (2) Pay the balloon payment (GFV) to own the car outright, or (3) Use any equity in the car as a deposit on a new PCP deal. If the car is worth more than the GFV, the difference is your equity.
What is the balloon payment or GFV?
The Guaranteed Future Value (GFV) or balloon payment is the amount the finance company guarantees the car will be worth at the end of the PCP term. Typical GFV values range from 30–50% of the original car price depending on the make, model and agreed annual mileage.
Can I end a PCP deal early?
Yes, under the Consumer Credit Act 1974. Under Voluntary Termination (VT), you can end the agreement once you have paid at least 50% of the total amount payable. You return the car in good condition with nothing more to pay. You can also do an early settlement by paying off the remaining finance.
Is PCP better than HP for car finance?
PCP has lower monthly payments because you do not pay off the full value of the car. HP has higher monthly payments but you own the car at the end with no balloon payment. PCP suits drivers who change cars every 2–4 years. HP suits drivers who want to keep the car long-term.
Official Sources & References
- FCA — Car Finance Consumer Guide
- GOV.UK — Vehicle Tax (VED) Rates
- Finance & Leasing Association — Industry Statistics
Data verified against official UK sources. Last checked April 2026.