PCP
Personal Contract Purchase is the UK’s most popular way to finance a new or nearly-new car. You pay a deposit plus fixed monthly payments over two to four years, then choose at the end: pay the pre-agreed “balloon” payment to keep the car, hand it back, or part-exchange it for a new deal. Monthly payments are lower than hire purchase because you’re only financing the car’s predicted depreciation, not its full price.
Example
A £25,000 car on a 3-year PCP might cost £3,000 down and £350 a month, with a £12,000 final payment if you want to keep it.