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Finance Explained

When you come to purchase your next car, you will be faced with a choice on how to pay for your vehicle. Cash is the traditional way to pay but finance is becoming more and more common. Here, we explain finance and do some jargon busting, so you know what to expect and how it works. If you have any questions, get in touch with the team who will be happy to help.

Finance is a different way of paying for a vehicle which means you spread the payments across several months instead of paying in one chunk as you would with a cash payment. Here’s everything you need to know about financing a car. The first thing to note is there are two finance routes you can go down.


Personal Contract Purchase is the first way of financing a car. It’s becoming increasingly popular but what does it really mean? The payments are spread out over a number of months, often over the course of one to four years with a deposit and what is known as a balloon payment at the end of the contract. The balloon payment is the remaining amount of money you will need to pay if you want to own the car. However, this is not the only option at the end of the agreement, you may also be able to hand the car back or negotiate a deal on another car. This will depend on your paperwork and your agreement, which you should always read in full before signing.


The second way to finance a car is through Hire Purchase. It is like PCP, but the payments are usually higher month on month as there is no balloon payment at the end and once the agreement is up, the car is yours to do with what you wish. As with PCP, check your agreement thoroughly and check that you understand all the terms included and make sure any mileage limitations are detailed and understood.

If you want to find out more about financing a BMW or MINI in London, get in touch with the team at Stephen James who will be happy to help and answer any questions you may have. View our stock and calculate finance prices online.