PCP - Personal Contract Plan | Thame Cars

Personal Contract Plans (PCP)

How Personal Contract Purchase (PCP) Works

Personal Contract Plans are an increasingly popular means of financing a used car purchase. They offer a straightforward, flexible means of spreading the payment of your next used car over a set period, whilst minimising the initial outlay and monthly repayments through the unique structure of the arrangement.

Under a PCP scheme, your monthly payments are reduced thanks to payment on a portion of the car’s value being deferred until the end of the agreement (typically three years). This is called the ‘guaranteed future value’ but is also known as a ‘balloon payment’.

At the start of the agreement, you pay a deposit on the car, with your first monthly payment due a month after taking delivery. At the end of the term of the Personal Contract Plan, you have three options:

Hand the car back to us and walk away

Pay the balloon payment to own the car outright.

Trade in your car for a newer model, with a new PCP arrangement.

It’s worth bearing in mind that your car may be worth more than the guaranteed future value (balloon payment) at the end of the agreement. If this is the case, you can use the additional equity towards your next used car at Thame Cars.

Benefits of a Personal Contract Plan

Typically, a PCP finance solution can offer a host of benefits such as flexibility, lower ownership costs and a chance to update the car you drive more often.

Thame Service Station t/a Thame Cars is an appointed representative of ITC Compliance Limited which is authorised and regulated by the Financial Conduct Authority (their registration number is 313486). Permitted activities include advising on and arranging general insurance contracts and acting as a credit broker not a lender.

Pay less each month

Lower monthly payments than a car loan or Hire Purchase agreement.

Low deposits

You don’t need a large deposit to sign up to a Personal Contract Plan. In fact, you don’t need one at all at Thame Service Station.


Change the length of the agreement, deposit amount and estimated mileage to alter the monthly repayment amount.

Protection against depreciation

A future value is guaranteed for your car, protecting you against large depreciation costs.

A guaranteed purchase price

Your future value is your ‘balloon payment’ – the guaranteed price at which you can buy the car at the end of the term.

Low finance rates

Typically lower APRs than Hire Purchase schemes due to shorter terms and the fact that you’re not paying off the full value of the car over the term of the agreement.