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PCP's, APR's, MGFV's - way too confusing.
It's easy to get confused when signing up for finance schemes, what with APR's, MGFV's, high deposits and low monthly payments or low deposits and high monthly payments, PCP's, PCH's and so on. But if you know what all the jargon means, and can differentiate between the various plans on offer, it's a lot easier to get the best deal, rather than the best sales spiel.

The main types of finance scheme

Personal Contract Plan (PCP)
Requires low monthly payments, low deposits, but a large payment (the MGFV, or Minimum Guaranteed Future Value) to own the car at the end of the plan period. Pay this or return the car.

Personal Contract Hire or Personal Leasing (PCH)
Like a long-term rental, where you return the car at the end of the agreed period - with no option to buy. High monthly payments, low deposits.

Lease Purchase/Hire Purchase
There's a deposit, high monthly payments, then a final payment to own the car at the end of the plan period. The higher the deposit, the lower the final payment.

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