Sparshatts Finance Explained

When financing your car purchase, it's important that you know the options available to you, so that you can pick the best one for your means and lifestyle. Here's some information on the finance available from Sparshatts: Hire Purchase (HP), Personal Contract Purchase (PCP) and Lease Purchase (LP). There are also some videos which will make it even clearer!

Hire Purchase (HP)

Hire Purchase (HP) is a straightforward and traditional way to finance the purchase of your car. Put simply, HP is a loan secured against the car, and the entire price of the vehicle is paid off with a series of monthly payments.
The amount paid monthly is determined by a variety of factors: the amount of deposit paid, the price of the vehicle, and the length of the contract. A longer contract will make your dream car more affordable, and the larger your deposit, the lower your payments.

Personal Contact Purchase (PCP)

A Personal Contract Purchase (PCP) is the most popular finance option when purchasing a car, as it has a great deal of flexibility for the customer, and is perfect for those who want to trade or return their car at the end of a contract, or to buy it outright.
A PCP Plan will offer the customer lower monthly repayments, by transferring a large amount of the total cost to a payment at the end of the contract, known as the Guaranteed Future Value (or GFV). An annual mileage agreement is worked out between you and the finance provider, and if you exceed this mileage during the contract period, you pay a fixed amount for every mile once you hand your vehicle back.

Lease Purchase (LP)

Lease Purchase (LP) is similar to Personal Contract Purchase, in that a lump amount is deferred to the end of the agreement, which reduces monthly payments. With a Lease Purchase, there is no option to return or trade the car at the end of the agreement, and you are expected to settle the final balloon payment (or Residual Value/RV) to gain ownership.
Some benefits of Lease Purchase include not being tied to any mileage restrictions, fixed interest and repayments and tax benefits. Settlement of the final payment can also be made at any time.


Sparshatts Group Limited is an appointed representative of ITC Compliance Limited which is authorised and regulated by the Financial Conduct Authority (their registration number is 313486). Permitted activities include advising on and arranging general insurance contracts and acting as a credit broker not a lender.

We can introduce you to a limited number of finance providers and may receive differing levels of commission from each of them for the introduction. All finance applications are subject to status, terms and conditions apply, UK residents only, 18’s or over, Guarantees may be required.