Car Finance Calculator

UK car finance comes in three main flavours, each with different monthly cost, ownership outcome and risk profile. Hire Purchase (HP) is a straightforward loan secured against the car: pay a deposit, then equal monthly payments over 1-5 years that cover the full car value plus interest, and you own the car automatically at the end. Personal Contract Purchase (PCP) is the most common new-car product: pay a deposit, then lower monthly payments over 2-4 years that cover only depreciation plus interest, and a large "balloon" payment at the end (the Guaranteed Minimum Future Value or GMFV) if you want to keep the car. Personal Contract Hire (PCH or "lease") is a pure long-term rental: pay an initial rental and monthly payments, hand the car back at the end, never own. Typical APRs in 2025 range from 0% on some manufacturer-incentivised PCP deals (Hyundai, Kia, BYD running aggressive promotions), through 4-8% for prime credit on standard PCP and HP, up to 12-15% for sub-prime applicants. PCP monthly payments are typically 30-50% lower than HP for the same car because most of the value is deferred to the balloon — but the total cost of credit can actually be higher because interest compounds on the unpaid GMFV throughout the term. PCH lease payments are usually similar to PCP monthly figures but with no buyout option at the end. This calculator models all three structures. Enter car price (or finance amount after deposit), term in months, APR and (for PCP) the GMFV. It outputs the monthly payment, total interest, total amount payable, and — for PCP — the three end-of-deal options: (a) pay the balloon and own outright, (b) hand back at zero cost subject to mileage and condition, or (c) part-exchange equity into a new PCP (if the car is worth more than GMFV, the difference becomes deposit on the next deal). Key watchouts. PCP mileage limits are punitive — exceeding the agreed annual mileage typically costs 8-15p per mile excess, payable on hand-back. Fair wear and tear inspections at the end often flag £200-£800 of damage charges. Voluntary Termination rights (kicking in at 50% of total amount payable paid) allow you to hand the car back early without further liability — useful protection but rarely understood. PCH leases are similar but without buyout option. The Court of Appeal’s October 2024 Johnson ruling on discretionary commission disclosure has been thrown into uncertainty — many recent finance deals may have mis-sold commission, with FCA-supervised redress likely in 2025/26. The calculator does not model discretionary commission, balloon refinance options, or maintenance packages bolted on. For unsecured personal loan car finance use the Loan Calculator instead; for total ownership cost see Car Running Cost Calculator.