Deal4Wheels

How Car Finance Works at Deal4Wheels

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No jargon. No pressure. Just facts.

Use this plain-English guide to understand PCP, HP, personal loans, balloon payments, and refinancing. We’ll show you what happens before, during and after you sign—plus worked examples and key FAQs. We’re a credit broker, not a lender; we don’t charge customers a fee and we’ll tell you about any commission on request before you sign.

The main car finance options

  • checkHire Purchase (HP car finance)
    • Pay a (optional) deposit, then fixed monthly payments over 24–60 months.
    • A small option-to-purchase fee is usually paid at the end.
    • When you’ve made all payments, you own the car.
    • Good for: keeping the car long-term; predictable payments.
    • Consider: monthly cost higher than PCP; no balloon.
  • checkPersonal Contract Purchase (PCP car finance)
    • Lower monthly payments because a big optional final payment (the balloon/GFV) is deferred.
    • At the end you can (a) pay the balloon to keep the car, (b) return it (mileage/condition charges may apply), or (c) part-exchange (subject to lender rules).
    • Good for: lower monthly cost; flexibility at the end.
    • Consider: if you keep the car, total cost can be higher once the balloon is paid.
  • checkPersonal loan (unsecured)
    • Borrow from a bank/loan provider and buy the car outright.
    • No mileage/condition rules, but the rate depends on your profile.
    • Good for: owning immediately; total flexibility.
    • Consider: may require stronger credit to get competitive rates.
  • checkRefinance / equity release
    • Replace an existing agreement or release equity in your car if the numbers stack up.
    • Good for: reducing payments or changing term (subject to status).
    • Consider: can increase the overall time in finance; check total amount payable.

We’ll confirm soft vs hard credit checks and how your data is used—see our Privacy Policy and Data Protection (DPA) notice.

Costs explained

  • checkCash price The vehicle price.
  • checkDeposit Optional upfront contribution that reduces what you borrow.
  • checkAmount of credit Cash price minus deposit (and any part-exchange).
  • checkAPR (Annual Percentage Rate) Your total yearly cost of borrowing, including the interest rate plus certain fees; best for like-for-like comparisons.
  • checkMonthly payment What you pay each month (fixed for HP/PCP).
  • checkFees E.g., option-to-purchase (HP), lender acceptance/doc fees, or (PCP) end-of-agreement charges for excess mileage/condition.
  • checkOptional final payment (PCP balloon) Pay it to keep the car.
  • checkTotal Amount Payable Deposit + monthly payments + fees + (PCP) balloon. Always compare using this figure.

Worked examples

Scenario: £12,000 car, 10% deposit, 48 months. Lenders set their own rates; your numbers will vary.

  • checkHP – Prime (rep. 10.9% APR)
    • Deposit £1,200; credit £10,800 → 48 × £275.95; option fee ~£10
    • Total repayable: £14,455.42
  • checkPCP – Prime (rep. 10.9% APR; balloon £4,200)
    • Deposit £1,200; credit £10,800 → 48 × £205.00; optional final payment £4,200
    • Total repayable (if keeping the car): £15,250.04
    • If returning the car, balloon isn’t paid but mileage/condition charges may apply.

Step-by-step: before, during and after you sign

  • checkBefore you apply
    • Eligibility & soft search – a quick check that doesn’t affect your score.
    • Personalised quote + representative example – clear APR and Total Amount Payable.
    • No broker fees – our service is free to customers; ask for commission disclosure any time before you sign.
  • checkWhen you proceed
    • Hard search & documents – lenders may run a hard credit check and ask for ID, income and bank details.
    • SECCI & agreement – you’ll receive a pre-contract summary and the full agreement to review in plain English.
    • Vehicle checks & handover – your supplying dealer will complete biometric/photo ID checks at handover to protect you from fraud.
  • checkAfter you sign
    • Payments & support – fixed monthly payments; talk to us or your lender if you need help.
    • Early settlement – you can request a settlement figure any time; paying early can reduce interest.
    • End-of-term – HP: pay the small option fee and the car is yours. PCP: choose to pay the balloon, return the car (mileage/condition rules apply) or part-exchange.