Used Car Finance Explained

  • Published: 7 June 2021
  • Used Car Finance Explained

Here at SW, we understand that buying a car can be a big financial commitment. This is why we work with a range of lenders to source the best possible deals to suit your needs. 

But with so many options available, where do you start? At SW Car Supermarket and SW Car Superstore, we offer two types of finance solutions; Hire Purchase (HP) and Personal Contract Purchase (PCP). 

What is Hire Purchase Finance?

Hire Purchase (HP) is one of the most common forms of used car finance. HP finance means that for the period of time you’re paying for the car, you effectively hire the car from a selected lender until the vehicle has been paid for in full. The loan from your lender is secured against the car, so you won’t fully own it until you’ve made your final payment.

Choosing HP finance will give you the ability to spread the cost, decide if you want to put down a deposit first, and allow you to own the vehicle outright at the end of your agreement. You’ll also have the option to pay off any outstanding finance at any point during the agreement and won’t be restricted to a certain number of miles per year. 

As with any financial agreement you enter into, we recommend that you fully understand all of the terms and conditions and are aware of all the commitments you are making, including any associated risks should you not meet the monthly repayments.

Click here to find out more or to fill out an HP finance enquiry form. Alternatively, please get in touch and a member of the SW team will be happy to help you.  

What is Personal Contract Purchase Finance?

Personal Contract Purchase (PCP) is a very popular form of used car finance and can offer much more flexibility compared to Hire Purchase (HP). With PCP finance, you’ll likely pay an initial deposit followed by fixed monthly payments. However, please bear in mind that you won’t automatically become the owner of the car at the end of your agreement. 

Instead, you’ll have three options; to pay the outstanding amount owed to fully own the vehicle, to part-exchange the vehicle (via SW Car Supermarket or SW Car Superstore) and begin a new contract on a different car, or return the car to the finance company. 

There are varying factors which contribute to the monthly amount paid during your finance term, including: deposit amount, mileage required, value of the car, and agreement interest rate.

Your monthly payment on PCP finance will likely be less than an HP deal, however, mileage limits do apply and you’ll incur financial penalties should you exceed the mileage cap. As with any finance plan, we recommend that you fully understand the payment agreement you enter into and the associated risks.

Click here to find out more or to fill out a PCP finance enquiry form. Alternatively, please get in touch and a member of the SW team will be happy to help you.

Used Cars for Every Budget 

With our HP and PCP finance plans, your next car could be closer than you think. No matter what car you’re looking for, we’re here to help. At SW, we specialise in the sale of high quality and low priced used cars, stocking up to 2,000 vehicles at any one time.

Visit our two state-of-the-art used car dealerships in Peterborough and enjoy the SW experience. Our vehicles are presented in a relaxed, spacious and modern environment and we’re committed to helping our customers find their dream car at the lowest price possible. 

Click here to start your car search today!

Transport For London

Cars need to meet minimum emission standards when travelling in the Ultra Low Emission Zone (ULEZ) or the daily charge must be paid.

Minimum emission standards

Petrol: Euro 4
Diesel: Euro 6

The ULEZ will be enforced based on the declared emissions of the vehicle rather than the age. However:

Information from Transport For London

Check this car on the TFL website before purchasing:

SW Car Supermarket

To save timely negotiation all our cars are heavily discounted upfront and offered nearer cost price, saving customers up to £2000 when compared to our competition. This ensures we are treating every customer the same. This fee is a compulsory fee and applies to all customers.

Variable admin fee is charged as listed below:

  1. Retail customers pay £199.
  2. Repeat customers purchasing a 2nd car within 12 months of the original invoice date £0.
  3. Retail customers arranging finance using brokers outside of our immediate panel of lenders £399.
  4. Trade customers making a purchase as the motor trade £499.
  5. Export customers including Northern Ireland and the Republic of Ireland £499.