Personal car leasing or PCP, which is best for you?

Difference between Personal Lease and PCP financing 
Two very popular options of vehicle finance are Personal Contract Plan (PCP), and Personal Contract Hire (PCH). In essence, both involve long-term rental of a new vehicle, with some used car dealers now offering PCP on used cars. Unlike PCP, leasing (PCH) the car through us here in Nifti doesn’t give you the option of owning the car at the end. If you do want to own the car, PCP might be the better option for you, but be prepared for a hefty lump fee (balloon payment) at the end of your deal to secure ownership. 

What are the benefits of Nifti Personal Leasing vs PCP? 
Leasing provides much more choice. Typically, when a PCP deal is agreed with a brand or car distributor, you are tied to that particular car make for the foreseeable future. When your three-year period is up, you can either return the car, pay the balloon payment to secure ownership, or agree to another fixed term with the same brand. With Nifti Personal Leasing, you have your choices of vehicles from a variety of manufacturers. For example, a small car may suit your needs now, but if you start a family and your vehicle size requirements change or perhaps you want an electric vehicle, then the choice with Nifti Personal Leasing is far greater. You also don’t have that scary balloon payment to think about! 

Is PCP the same as Personal Leasing? 
PCP is a purchase plan, so it’s geared towards you owning the car at some point. It is not a lease deal even though the option to walk away is available; your initial deposit/equity will be lost. PCP works best if you are happy to stay with one brand and you secure a lower percentage on your repayments. If you don’t, a lease plan works best. 

Is leasing a car cheaper than PCP?
In Ireland, the prices tend to work out similarly on monthly payments between leasing and PCP, but really it comes down to that initial payment. You have the option to make an initial payment at the start of the Nifti Personal Lease. Think of this as forward paying your lease contract. The forward payment reduces the fixed monthly lease cost. The more you can afford up front, the cheaper your monthly payments will be.

It’s all about figuring out what works best for you. In most cases, PCP requires a larger deposit, which in turn lowers your monthly payments, but comes off the overall price of the car. 

The main thing to note is that with a leased car, there’s no need to worry about depreciation, and you get a brand new car for an affordable monthly fee tailored to suit you.

Should I lease or take the PCP option?
If you want a stress-free way of driving a new car of your choice for a fixed term, then leasing is probably the way to go. If you want to someday own that new car outright and are happy to stay with one brand, then PCP might be for you. 

Is it better to personal lease or PCP finance?
If you fully intend to own the car someday or want to make changes to the vehicle such as wheels or styling modifications, then PCP is best for you. However, we think personal lease is the better option. When a car uses up its warranty period and becomes subject to the national car test (NCT), it’s nice to know you can hand it back and get ready to enter a new Nifti contract. 

Is it easier to get a Nifti Personal Lease or PCP?
These options are similar in this regard. For both, you will need proof of identity and address for the last three to five years and proof of income (i.e. through a pay slip or bank statement). A decent credit rating is essential for obtaining any long-term lease or PCP deal. Bank details for the account you wish to set the direct debit up with will be required, so make sure all is operational and in good health before pursuing.  

Still weighing up your options as to what is the best option for you? Check out our explainer guide on Buying vs Leasing a Car.

If you have more questions or want to learn more about Personal Leasing, check out our Help and Advice page.

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