Here's a breakdown for your clarity:
Hire Purchase (HP)
Hire Purchase agreements involve credit where you gain ownership of the vehicle after repaying the total loan amount. While the financier holds ownership during the loan term, it transfers to you upon full repayment. Typically, HP agreements have higher monthly payments as you're repaying the entire car amount, in contrast to PCP.
Personal Contract Purchase (PCP)
Personal Contract Purchase agreements entail paying instalments to cover a portion of the car's cost. Upon fulfilling the agreement's terms, you can return the car to the financier (owner). Alternatively, if you wish to keep the car, you can refinance the remaining cost – the balloon payment, based on the car's guaranteed future value (GFV). Please call or make an enquiry at Ace Motor Hub Ltd for great finance deals on our used car stock.