Unclear PCP contract

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This topic contains 3 replies, has 3 voices, and was last updated by Stuart Masson Stuart Masson 2 years, 9 months ago.

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  • #56688 Reply


    Hi Stuart,

    I’m very close to buying a car, but have some issues with the contract. It’s been built and was delivered to the dealer to the dealer this week. And I’ve received the contract to review and sign.

    I asked for a PCP. What I’ve been sent is titled a Hire Purchase, and the contract is with RCI financial services.

    The contract is built up of a deposit, 36x equal monthly payments and a 37th very large payment (final instalment).

    There are no references on the contract to ‘GFV’ or ‘GMFV’ or ‘optional final payment’ (as per my previous PCP contracts) however the dealer and the finance company are both telling me that all of their PCP deals are called Hire Purchase agreement. And they’re all built and worded the same way. It ‘feels’ like a PCP but I don’t have any confidence in the T&Cs.

    Hope you can help clear things up for me please? Stephen

  • #57064 Reply
    Stuart Masson
    Stuart Masson

    Hi Stephen. There’s probably no great reason to be concerned, but hopefully this helps:
    1) A PCP is a form of Hire Purchase, but rather than split the payments into 36 equal mid-size chunks, you have 36 smaller chunks followed by one large one. Other than that, they are essentially the same product in terms of your rights and responsibilities.
    2) The key difference of a PCP is the GMFV. This is where the finance company agrees to buy the car back for a value equal to your final instalment as long as you comply with the conditions (mileage, condition, servicing). If your contract does not include a GMFV then you do not have a PCP. What you may have is a lease purchase. Here there is no guarantee, you simply owe the final instalment and cross your fingers that you can sell or PX the car for more than that number.
    3) RCI Financial Services is Renault’s finance company, so I’m guessing you have bought a Renault or Dacia? If the dealer is not giving you straight answers then you can always call RCI direct and ask to speak to someone. Renault’s PCP offer is called ‘Renault Selections’. If you see this name anywhere on your paperwork then it should be a PCP agreement.
    4) The contract should include a clear explanation of the GMFV/optional purchase payment. If this is not there you have every right to ask why not, and to see any and all conditions of the GMFV.

    Don’t be afraid to ask the dealer or finance company as many questions as you like until you are satisfied. It is their legal obligation to explain every aspect of the agreement to your satisfaction. If you are not 100% confident, don’t sign anything. Far too many people are too afraid to ask questions for fear of sounding stupid, so dealers are able to get people to sign things they shouldn’t…

  • #61495 Reply


    Hi There

    I have the same concern. I have proceeded with a potential purchase of a new Audi through Orange Wheels due for delivery in 3-4 months. I asked for a 3 year PCP deal as wish to have the option to return the car at the end of the 3 years due to the fact I do a high annual mileage and previous cars have been worth less at the end of the term as a trade in than the outstanding finance. I want to be able to surrender the car at the end of the term if this is the case, however the dealership has supplied me with Pre Contract-Credit showing ‘3 year Hire Purchase’ stating 35 monthly payments + a (huge) final payment at 36 months. There is no (stated) option to return the car according to the paperwork.
    Having made a bit of a fuss, the dealer did then supplied me with a screen shot of my agreement showing that I do have a solutions PCP but I cannot understand why my Pre Contract paperwork and the screen shot do not match.
    My current car is on PCP through Mercedes finance and the Pre-Contract paperwork clearly states that I have 3 options as the end of term. (There is no mention of a GMFV on the Audi Pre-Contract, just that the high final payment is due at 36 months)
    Should I be concerned?

  • #61499 Reply
    Stuart Masson
    Stuart Masson

    Hi Steve. It’s always more complicated when you are buying the car via a third party, as it introduces a lot of distance between you and the finance company, and plenty of finger-pointing when things don’t go according to plan. Audi’s PCP product is called Solutions, and the paperwork should show the GMFV.

    Best bet is to call Audi Finance directly for a proper explanation, and to clarify any of your concerns. They should be able to look up your quote (and the agreement if it’s already been set up by the dealer for you to sign).

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