What Does PCP Stand For (Car Finance)

We get this question all the time from our car leasing customers, "what does PCP stand for"? In this article we'll give you a jargon free PCP explanation.

"What does PCP stand for?" is a question that either myself or someone within my team is asked every single day. With good reason as well, why would/should someone from outside of the car leasing industry know what does PCP stands for? PCP stands for Personal Contract Purchase.

Let's take a look at what this actually means. A PCP agreement is typically only available for personal users. Contract users enter a contract over a set period. This is normally two, three or four years. This type of contract is unique in the fact at the end of the contract period users have the option to purchase the vehicle for a set amount. This amount (referred to as a balloon payment) is agreed at the start of the contract.

Don't forget, this is 100% optional - you can simply hand the vehicle back at the end of the contract if you wish.

Hopefully this short, but sweet article has got right to the point and answered the question "what does PCP stand for?". We'll be following up this article with a full in-depth explanation of a PCP (Personal Contract Purchase) agreement in the next few days.

If you have any questions or just want some straight-talking advice please feel free to call our team on 0151 728 4711 or visit Stable Vehicle Contracts. If you are considering changing your lease car or van in the near future why not join the thousands of subscribers who already receive our weekly newsletter. Each week we aim to send out a selection of the very best contract hire & leasing offers in the UK!