What is the difference between PCP and Hire Purchase?

PCP (Personal Contract Purchase) and Hire Purchase (HP) are two common ways to finance a car purchase, and they have some key differences:

PCP (Personal Contract Purchase):

  • Deposit: You'll pay a deposit upfront, typically around 10% of the car's value.
  • Monthly Payments: You'll make fixed monthly payments over an agreed-upon term (usually 2-4 years).
  • Final Payment: At the end of the term, there's a final larger payment (final payment) if you want to own the car outright. This final payment is optional; you can return the car to your dealership, or trade it in for a new one and continue your PCP journey.
  • Ownership Options: At the end of the term, you can choose to pay the final payment to own the car, trade it in for a new one (using any equity remaining in your car as a deposit), or simply return the car and walk away.

Hire Purchase (HP):

  • Deposit: Similar to PCP, you'll pay a deposit upfront (usually around 10-20%).
  • Monthly Payments: You'll make fixed monthly payments over an agreed-upon term (usually 1-5 years).
  • Ownership: Unlike PCP, with HP, you'll own the car outright once all payments (including any interest) are made.
  • Flexibility: There's no large final payment at the end, making budgeting more straightforward, but monthly payments might be slightly higher compared to PCP.

In summary, PCP typically offers lower monthly payments but requires a larger final payment if you decide to own the car outright. It also offers more flexibility at the end of the term regarding whether to keep the car, trade it in, or return it. On the other hand, Hire Purchase involves higher monthly payments but guarantees ownership of your car without any large final payment at the end of your finance journey.


Toyota Financial Services at Denis Mahony provides a range of flexible and affordable finance options for new cars and commercial vehicles, as well as Approved Used vehicles. Discover the main benefits of our products.
You may be surprised how easily you could be driving away from one of our Denis Mahony showrooms in your dream car!


Established for over 50 years, we have enjoyed an unparalleled reputation as a Motor Group and Finance Intermediary in the Irish marketplace.
The quality and reputation of our dealership submitting your application, is of paramount importance when it comes to underwriting criteria in relation to a motor loan application.
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