Finance Plans Explained
From Elect 3 to hire purchase, here's everything you need to know about financing your next car. It might seem daunting, but in reality, it's just a simple two-stage process. The first stage is to decide on the type of car deal you want: loan, lease, hire purchase, or dealer finance. Then it's a simple matter of choosing the provider whose product best suits your needs.
Personal Contract Purchase
A Personal Contract Purchase (or PCP) agreement is a way to purchase a car with a deposit and monthly payments. It also gives you additional flexibility since part of the cost of the car is deferred until the end of the contract
The deferred amount is known as the Guaranteed Future Value (GFV) sometimes called an Optional Final Payment or Balloon Fee. This gives you the benefit of tailoring your monthly payments to suit your budget.
Personal Contract Purchase is a flexible car finance option, especially if you’re unsure what you will want to do with your vehicle at the end of your contract or require lower monthly payments than a standard Hire Purchase Contract.
Together with our brands we offer PCP agreements that include your tax, your insurance, your warranty, roadside assistance and servicing.
At the end of the agreement, you have 3 options:
- Part exchange your vehicle for a new one and start another contract, paying any excess mileage and/or damage (if applicable).
- Return your vehicle to us, paying any excess mileage and/or damage (if applicable). Should excess mileage and damage impact the value of your vehicle it could be worth less than the GFV, meaning that additional payment could be necessary.
- Keep your car, by paying the Guaranteed Future Value
Personal Finance Lease
Personal Finance Lease is similar to Personal Contract Purchase but the main difference is that you don’t have the option to purchase the vehicle at the end of your contract.
You will need a deposit when entering into a contract, as well as agreeing your annual mileage. You will then pay monthly instalments to use the car over your agreed contract period.
You can tailor your monthly payments to better suit your budget by varying the deposit and duration of the contract or agreeing a final lump sum balloon payment that will ensure lower monthly repayments throughout the agreement. The balloon payment is calculated on the anticipated value of the vehicle at the end of the agreement.
At the end of the agreement you have 4 options:
- Sell the vehicle to a third party on our behalf. If you sell it for less than the balloon payment value then you’ll have to pay the difference. If you sell it for more then you’ll keep the surplus.
- Part exchange the vehicle for a new vehicle with one of our dealers.
- Return the vehicle to us and pay any excess mileage and/or damage charges (if applicable).
- Continue leasing the vehicle by entering into the secondary rental period. You’ll need to pay the balloon rental and then a peppercorn rental which is payable every year until you return the vehicle or notify of sale to third party
Personal Contract Hire
Personal contract hire is effectively a long-term car leasing contract. You will not own the car at the end of your contract, you will just be leasing the vehicle whilst you use it.
You will need to pay an advanced rental when ordering the vehicle. This will be agreed at the time of ordering your vehicle and can be discussed with your dealer.
You will then agree your mileage allowance per year which will help determine your monthly rental payments to lease the car over your agreed contract period.
At the end of the contract, you return the car to us and pay any excess mileage and/or damage charges.
Hire Purchase is the traditional way of purchasing a car on finance. You will pay a deposit at the beginning of your agreement and then pay equal monthly instalments until the end of the contract. At the end of your contract you will own the car outright.
The initial deposit and repayment period can be determined to help meet your budget and the length of time you want to keep the vehicle.
You can also trade in your existing vehicle and put this towards the initial deposit, or if you wish, just put down a cash deposit.
Unlike other products, you don’t have to estimate your mileage to determine your payments and there is no Guaranteed Future Value (GFV) payment at the end of the contract.
Hire Purchase is a suitable option for those who know they want to own their car at the end of the contract.
Citroën has developed Citroën SimplyDrive to offer our customers a finance option that provides 3 years of motor insurance, routine servicing, roadside assistance, warranty and road fund licence, all included in one fixed monthly payment. Citroën SimplyDrive is available on the majority of models funded on Personal Contract Purchase.
At the end of 3 years you then have the option to enter a new agreement on another new vehicle or choose another end of agreement option.
How does CITROËN SIMPLYDRIVE work?
- Select the Citroën vehicle that’s right for you.
- Choose your annual mileage (6,000 to 30,000).
- Select the amount you wish to contribute as a deposit (between 0% and 40% of the vehicle price)
- We will calculate the monthly payment for the full 3 year term of the agreement.
- Your monthly payment will include a contribution towards the cost of your motor insurance. This is based on the age of the youngest driver, your residential postcode and model selected.
Additional charges may apply at the end of the contract subject to the vehicle condition and excess mileage.
SimplyDrive Key Features
✔️ 3 Years' Finance
The Personal Contract Finance product has a full term of 36 months, with 35 monthly payments followed by 1 optional final payment.
✔️ 3 Years' Comprehensive Motor Insurance
With Citroën SimplyDrive your motor insurance policy will be automatically renewed to ensure you benefit from three years continuous cover (subject to underwriting criteria). Better still, your premium will remain fixed for the duration of your contract. (We do reserve the right to increase your premium should you add a younger driver to your policy mid-term).
✔️ 3 Years' Routine Servicing
Keeps your car running in tip-top condition with servicing carried out by the specialists at your local Citroën service centre.
✔️ 3 Years' Roadside Assistance
Just in case...
✔️ 3 Years' Road Fund Licence (if applicable)
Your first year’s road fund licence is included and your dealership will give you a cheque to cover the costs of years two and three (based on current duty rates at time of purchase).
✔️ 3 Years' Warranty
Just in case...
✔️ 3 Years' Payment Waiver
In the unfortunate event of you being made redundant involuntarily, Citroën Financial Services will waive up to 6 monthly instalments giving you time to find alternative employment. If you are still unemployed after 6 waived instalments you are given the option to hand your vehicle back without further financial liability. (Subject to terms and conditions).
ALL FOR ONE MONTHLY PAYMENT
We know unemployment can be a concern for some individuals when considering whether to take on a financial commitment. We offer you peace of mind and security as a number of our contracts include a feature called Payment Waiver.
Our Payment Waiver will cover you if you are made redundant through no fault of your own, waiving up to six monthly instalments, which you will never have to repay.
Should you still be unemployed after we have waived your six monthly instalments, you will have the option to hand back your vehicle and walk away from your agreement without any further financial liability*
*Your account must not be in arrears and excess mileage or damage charges may apply. Payment waiver does not cover balloon payments. Terms and conditions apply to these payments.
Payment Waiver is available on both new and used vehicles across our dealer network. For more information on this product, speak to one of our Sales Team who will be able to talk through your finance options.