More Information on Personal Contract Hire
Personal Contract Hire (PCH) is based on a fixed term contract where customers pay an agreed monthly charge for the use of a vehicle for a previously agreed period.
- Flexible and low initial rental
- Fixed monthly rentals
- Fixed mileage contract
- Fixed term contract
- Option to include maintenance
- No depreciation risks
- VED (Vehicle Excise duty) included in the contract for the duration of the agreement.
- You only pay for the use of the vehicle
- Flexible profiles to suit you
- At the end of your contract simply hand the vehicle back
- The vehicle must be returned in a well-maintained condition set by the industry standard, please see the BVRLA fair wear & tear guidelines
- Early termination can be expensive
- You will never own the vehicle and there is no option to buy it
- There are excess mileage charges if you go over the agreed mileage, which is charged on a “pence per mile” basis set at the start of the contract
It benefits customers wishing to eliminate the financial risk associated with disposing of a vehicle. Contracts are usually taken over two, three or four years, providing a high level of flexibility. Some contracts can be formally extended beyond the end of contract date if required. Just ask and we can answer any of your questions regarding extending your contract.
PCH is very similar to business Contract Hire; both are based on a fixed annual mileage agreed on inception of a contract. You will need to decide how many miles you drive each year before quotations can be obtained. Once you have stated how many miles you drive in a year and considered which vehicle you would like to lease a quote can be created for you by one of our sales team.
Regulations with regard to making mileage amendments after contracts are live vary from funder to funder, so it is always better to be as accurate as you can be. If you do exceed the agreed allowance at the end of your contract you will pay an excess mileage charge, which will have been agreed upon prior to signing the finance agreement.
Please remember this when deciding upon you annual mileage. If you are looking to have predictable motoring costs adding maintenance to your monthly payment is easy. Maintenance is there to put your mind at rest should any challenges arise with your vehicle and generally covers servicing, routine maintenance, tyres, exhausts and batteries.
Please note that it is responsibility of the person named on the finance agreement to arrange and pay for fully comprehensive insurance for the vehicle. It is important that the vehicle is returned in accordance with the guidelines set out in the 'Fair Wear and Tear Guide', a copy of which is made available to customers when they are near the end of their PCH agreement.
What Happens At The End Of The Contract?
Once the contract comes to an end the vehicle is returned to the finance company meaning the customer is free to lease or purchase another vehicle if they wish.
If the agreed mileage has been exceeded there will be an excess charge which would have been set at the start of the contract.
The vehicle is then assessed based on the BVRLA Fair Wear and Tear guidelines https://www.bvrla.co.uk/service/fair-wear-and-tear-guides If there’s any damage that falls outside of these guidelines and is deemed unacceptable you may be subject to a charge.