✔ New to PCP Finance? Take a few minutes to review our PCP Finance Guides to ensure you understand exactly what is involved when you buy a car using PCP finance.
Getting Started: Enter the figures from the PCP deal you are reviewing, the PCP calculator will automatically update your results. Click on the query button to the right of any field to review information and guides on that specific topic.
About the PCP Calculator
The PCP Calculator allows you to compare the costs of financing your car through a PCP loan and provides transparency of the real costs of PCP finance including monthly repayment schedules, costs and depreciation figures so you can make an informed choice when buying a new or used car with PCP finance. Please contact us if you would like additional features added to the PCP Calculator or any of the other Car Finance Calculators provided on this site.
PCP Car Loan Calculation
This PCP loan calculation is for illustration purposes only and the figures may alter dependent on the PCP finance plan for your car finance. 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. So, shop around, PCP deals are not all the same. 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.
What is a PCP Loan?
PCP (Personal Contract Purchase) is a type of car loan. PCP loans provide relatively low monthly repayments and make car finance very affordable.
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. The car finance is then calculated based on the value of the car now minus the residual value.
Example of PCP Loan - BMW PCP Finance example
Imagine you are looking to take a PCP loan on a new BMW at £ 97,500.00. You want the loan over 3 years. The BMW dealership provides you a residual value (commonly called Guaranteed Future Value) of £ inf.
In this example you pay no deposit on your new BMW so the PCP loan will be for £ inf (that's £ 97,500.00 minus £ inf.
Clearly 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.
PCP loans can be a great way of financing your new car but shop around first and talk to the car dealership. Keep an eye out for 0% car finance deals, this is where you typically get the best car finance deals.
Wow! Low monthly payments! ▼
We all love a bargain but question those eye catching monthly repayment plans.
As PCP loans are calculated on the future value of the car, the best deals are on cars which retain their value. This is a key point when you don't intend to keep the car at the end of the PCP loan contract.
You don't own the car! ▼
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. 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.
Used car PCP finance: ▼
PCP Interest rates on used cars are typically not as good as the interest rates provided on new cars. Always compare the monthly amounts on your PCP contract, you may be better off buying a new car rather than a used car.