Finance
We are a credit broker and not a lender. We work closely with our finance partners who can introduce you to a number of lenders and their finance products which may have different interest rates and charges. We are not an independent financial advisor. We will provide details of products available from the lenders we work with, but no advice or recommendation will be made. You must decide whether the finance product is right for you. We do not charge you a fee for our services.
Warning: Late repayment can cause you serious money problems. For help, go to www.moneyhelper.org.uk
INTRODUCTORY COMMISSION. PLEASE NOTE.
Whichever finance partner we introduce you to, we will typically receive commission from them (either a fixed fee or a fixed percentage of the amount you borrow). The finance partners we work with could pay commission at different rates. However, the amount of commission we receive from a lender does not have an effect on the amount you pay to that lender under your credit agreement.” If you would like further information on the nature of the commission / remuneration that we may receive, you may request this in writing by email to sales@turbocentre.co.uk
HIRE PURCHASE EXPLAINED
Spread the cost with a choice of payments from 1 - 5 years. Choose the amount of deposit you wish to put down.
The interest rate is fixed so your repayments stay the same throughout the agreement - it makes budgeting simpler.
If you choose to pay for your car with a Hire Purchase agreement, you will normally pay an initial deposit and will pay off the entire value of the car in monthly instalments. When all the payments are made, the Hire Purchase agreement ends and you own the car.
You’ll be able to drive away a car that you may not have managed to buy outright.
Unlike a PCP you won't need to estimate your mileage at the start of your Hire Purchase agreement, so you'll avoid excess mileage charges.
Once you’ve made your final monthly payment, including the option to purchase fee, you'll have full ownership of the car.
Other things to consider
Monthly payments may be higher than some other finance options, such as PCP, as you're paying off the full value of the car.
You won’t be able to sell the car without settling the finance.
You won’t own the car until you have made all of your repayments.
You’ll need to keep the car properly insured, maintained and in your possession until the full value is paid off.
PERSONAL CONTRACT PURCHASE (PCP) EXPLAINED
For your vehicle purchase our PCP plans allow us to quote you the most cost effective monthly repayments.
Personal Contract Purchase (PCP) is similar to a Hire Purchase agreement as you will usually pay an initial deposit, followed by monthly instalments.
What makes PCP different is that your monthly instalments are paying off the depreciation of the car, and not its entire value, over the course of the term. Then, when you get to the end of your agreement, there is a final, balloon payment that must be made if you want to keep the car.
How does PCP actually work?
At the start of your PCP contract, a Guaranteed Future Value (GFV) of the car is set. This is the car's expected value when your contract ends.
For you, this means that the money you’re repaying is the difference between what the car is worth now and what it will be worth at the end of your contract (the depreciation) plus interest, which is calculated on the full value of the vehicle. You'll pay this difference off in monthly instalments.
Remember: you are still liable for the full amount of the vehicle if anything happens to the car or if you settle early.
This means lower monthly payments for you, but you will need to pay a final payment at the end (the Guaranteed Future Value) if you want to keep the car.
Once your agreement is finished, you’ll have three options:
1. Buy the car by paying the final balloon payment (the Guaranteed Future Value).
2. Hand the car back - your finance company has already predicted the Guaranteed Future Value of the car, so handing the car back will settle the deal.
3. Part exchange for a new car.
Advantages
Monthly payments on a car financed by PCP are usually lower than if your car is financed by a Hire Purchase agreement.
If you decide not to buy the car, you can simply walk away when you've made all the payments.
You can drive away a new or used car every few years (dependent on the chosen term) without worrying about selling it on.
If your car is worth more than the Guaranteed Future Value then you can use that equity towards a deposit on a new car.
Things to bear in mind
If you want to buy the car you will need to pay your final balloon payment (the Guaranteed Future Value).
Similar to PCH, you will need to agree on a mileage allowance at the beginning of your contract and there may be excess mileage charges if you exceed this.
You won’t be able to sell the car without settling the finance.
You won’t own the car until you have made all of your repayments.
You’ll need to keep the car properly insured, maintained and in your possession until the full value is paid off.
LEASE PURCHASE EXPLAINED
Lease Purchase is a form of Hire Purchase or Conditional Sale agreement - requiring you to take ownership of the vehicle after all payments have been made - but the regular payments are structured like a lease/rental agreement. You may be asked to pay a number of monthly payments at the start of your agreement (referred to as ‘advance payments’ and the leasing equivalent of a deposit) and a sum is usually deferred in the form of a balloon payment at the end of the term. The balloon payment will be determined by the age and mileage of the car at the end of the agreement.
The difference between a Lease Purchase and a PCP agreement is that the balloon (referred to as a Guaranteed Minimum Future Value (GMFV) in a PCP deal) must be paid on a Lease Purchase agreement. With PCP, it is optional.
At the end of the agreement
There is no option to return the car at this point so the deferred sum has to be made. This may be done through a cash payment or alternatively via a second finance agreement. A typical lease purchase agreement will last between two and four years. It is possible to fully or partially settle the outstanding finance at any point by contacting your finance company.At the beginning of the agreement
You may be asked to put down advance payments (essentially a deposit) against the car and you will then make monthly payments for the duration of your agreement. The deferred payment that must be paid at the end of the agreement is what the car will be worth at that point in time, taking into consideration your anticipated mileage, the age of the car and the length of the agreement.
Advantages of Lease Purchase
Lower monthly repayments because advance payments (deposit) are generally paid at the beginning of the agreement and a balloon payment is deferred until the end.
Lower monthly repayments may help you to afford a higher specification car.
The deferred balloon payment helps you to save money to pay off the car at the end of the agreement.
You choose the length of the finance agreement.
Things to remember
i. There is no return option at the end of the agreement.
ii. You must have sufficient funds (or apply for a second finance agreement) to pay off the deferred sum.
iii.Depending on current market conditions, the value of the outstanding balloon payment may be higher than the actual market value of the car.
NOTE:
We can help you drive the car of your dreams. Our finance providers offer a range of car finance options to suit your budget. We are always here to help you with organising your chosen finance product. We do not offer advice or recomendation on Consumer Credit products.
TURBOCENTRE VEHICLE FINANCE
For a personal written quote please contact us
Finance available subject to status. Indemnities may be required. Finance is available to UK residents aged 18 years and over. Terms and conditions apply.
We do not provide financial advice. We are a Credit Broker and Intermediary. TURBOCENTRE CAR SALES LTD is authorised and regulated by the Financial Conduct Authority . Our details appear on the Financial Services Register our registration number is 652927.
Other finance offers may be available but cannot be used in conjunction with any products offered.