Personal Contract Hire (PCH) is becoming a popular choice for private individuals with many people opting for the leasing model over traditional finance such as Hire Purchase or Personal Contract Purchase (PCP).
When you take a Personal Contract Purchase, you pay the rent to the leasing funder, leaving the finance company to worry about the depreciation of the vehicle and the disposal. You never own the vehicle from Day 1.
When you take a Personal Contract Purchase, you effectively rent the vehicle from the finance company. This has many benefits to you but the most important aspect of this sort of agreement is that you leave the depreciation and the disposal to them.
Personal Contract Hire doesn't work for everyone, you've got to commit to the term of between 18 and 48 months. Early termination can be costly and as we all know circumstances can change.
However, if you can commit to a period then Personal Contract Purchase can be a great way of running a vehicle.
If you choose to lease a vehicle using Personal Contract Purchase, you will make a number of monthly payments for the duration of the lease agreement, this is usually between 18 and 48 months. You will pay an initial rental upfront, this is usually the equivalent of 3, 6, 9 or 12 months upfront, however, don't get confused. The initial payment does not count towards any more than your first months rental and is just a term used in the Contract Hire & Leasing sector.
At the end of the contract you simply hand the vehicle back to the finance company leaving you to take out another or purchase a vehicle.
Personal Contract Hire is available from multiple funders and their credit status criteria differs from firm to firm. The majority of the leasing funders that we use within our Long Term Contracts will require a Good to Excellent credit score. Some may look at taking you on and may differ the terms offered, should you not meet this criteria.
Cocoon Vehicles can help you should you not meet the needs of the funder, we can utilise our Short Term Car Leasing fleet to get you mobile and give you time to correct your credit score ready for a long term deal. Please contact the team on 0800 802 1940 for more information on this programme.
At the end of the contract, your vehicle is returned to the Contract Hire funder. This means that you are free to hire or purchase another car.
If you have gone over the contracted mileage on the car, an excess mileage will be payable. At the beginning of the contract it is always best to estimated the mileage based on true figures and not just head straight for the headline price. All excess mileage is based on a pence per mile basis and will be laid out to you in the contracts at the beginning of the agreement.
When the vehicle is returned, the vehicle will be assessed according to the BVRLA Fair Wear and Tear Guidelines (This does not include flexi-rent or Short Car Leases). Any damage that falls outside of these guidelines may be subject to end-of-lease charges. For more information on the end of contract procedures, please visit the BVRLA Fair Wear & Tear Guidelines.
* All vehicle images and car descriptions on this site are for illustration and reference purposes only and are not necessarily an accurate representation of the vehicle on offer. All offers maybe withdrawn at anytime and without notice. E and O E
T: 0800 802 1940
F: 01332 292306
Cocoon Vehicles Ltd
The Old Co-Operative
36 Holbrook Road
Cocoon Vehicles Ltd are a credit broker and not a lender, we are authorised and regulated by the Financial Conduct Authority. Registered No : 711074
Registered in England & Wales with company number : 06113683 | Data Protection No : Z1350323 | VAT No : GB 907 7553 04
Registered Office : The Old Co-Operative, 36 Holbrook Road, Belper, Derbyshire, England, DE56 1PA
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