How does Personal Contract Hire (PCH) work? | Chorley Group
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How does Personal Contract Hire (PCH) work?

PCH is a long-term vehicle leasing agreement for private individuals. PCH is an ideal solution if you're just wanting to drive new cars regularly without having to worry about the vehicle's future value and depreciation.

A Personal Contract Hire agreement is a popular and cost-effective method of vehicle leasing. It works similarly to a Business Contract Hire but it applies exclusively to private individuals. You will make fixed monthly payments based on a fixed mileage allowance over a specified period of time. At the end of the contract you simply hand the car back, that's it.

The most obvious difference between PCH and other forms of vehicle financing like PCP or HP is there is no option to buy the vehicle at the end of the contract. The advantage of this is you don't need to worry about reselling the car or its value at the end of the agreement.

What are the benefits of Personal Contract Hire (PCH)?

PCH is the ideal funding option if you like to change your vehicle frequently without the worry of depreciation and the costs that go into maintaining your own vehicle. There are other benefits to Contract Hire leasing:

  • Monthly payments are often lower than other finance options like PCP or HP as you are only paying for the depreciation costs of the car over time
  • Low entry costs to brand new luxurious vehicles, initial payments/deposit is usually three or six monthly payments in advance.
  • No depreciation worries - at the end of the lease you don't have to worry about selling the vehicle.
  • Road tax (Vehicle Exercise Duty) is often included in the agreement.

Enquire about PCH Finance

What happens if you use more mileage than agreed at the start of the contract?

If you choose the hand the vehicle back and have exceeded the agreed annual mileage you will be liable to pay for each mile over the agreed total. The condition of the vehicle will also be assessed according to the BVRLA (British Vehicle Rental and Leasing Association) Fair Wear and Tear guidelines. Any damage outside the BVRLA guides may be subject to end-of-lease penalty charges.

Does Chorley Group provide finance?

No. Chorley Group acts as a credit broker between you and one of our lending partners. Once we have built and agreed on a finance package with you, we will submit your claim to one of our lending partners for approval - this is often done on the same day.

Do you qualify for Personal Contract Purchase leasing?

To be eligible for car financing on a vehicle you must be at least 18 years of age with a full UK driving licence. A decent credit rating is required for all finance agreements. Your credit approval is subject to the lenders satisfaction, however, we can assist you in performing a 'soft credit check' to see whether you may or may not be eligible before we build a PCH deal with you.

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