Personal Contract Hire

An alternative funding option to PCP, personal contract hire (PCH) offers drivers similar benefits of a corporate contract hire arrangement but is designed purely for an individual.

The underlying contract is a regulated hire agreement whereby the hirer agrees to pay a monthly rental + VAT for a period of time to use the vehicle. As with corporate contract hire LVS set a future resale value for the vehicle based upon anticipated mileage over a 2, 3 or 4 year period; this is then deducted from the discounted cash price of the vehicle and payments are based on the difference, together with an interest repayment.

Drivers, therefore, only pay for the proportion of the car’s life that is used, thereby, reducing the monthly payment. The vehicle is then simply handed back at the end of the contract and, assuming it is returned in a condition commensurate to its age and mileage, it has a full service history and that the agreement mileage has not been exceeded, there is no further payment to pay. There is no option to own the vehicle at the end of the agreement.

  • Low initial costs
  • Fixed monthly repayments
  • No risk on disposal
  • Optional fixed cost service and maintenance plans