Finance

For frequently asked questions regarding financing, please see below.

I need a finance deal to help me buy a car-can you help?

Yes. When you buy a car from OMRG, our lenders will help you work out which type of finance is best for you.

What is the difference between Hire Purchase (HP) and Personal Contract Purchase (PCP)?

Car finance can be confusing but our lenders can find a deal that works for you.

Personal Contract Purchase (PCP)

The lender sets a ‘residual value’ on the car, (what they predict the car to be worth at the end of the agreement,) which is deducted from the current price of the car.

The remaining balance is spread across 24 to 48 payments or months. If you opt for PCP finance then it’s likely that your monthly payments will be much less than if you use HP.

You have 3 options open to you when you’ve completed your payments:

1) Buy the car outright for a pre-agreed value using a ‘balloon payment.” You will then own the car completely. In this case, choosing a Hire Purchase agreement would work out cheaper overall.

2) Hand the car back to the lender. Lenders will usually apply an annual mileage limit, so if you have gone above the limit by the end of the agreement, you may be charged an excess mileage fee.

3) Use the car as a part-exchange. If by the end of the agreement you notice that your car’s current value is higher than the predicted value or ‘balloon payment’ then you can use your car as a trade-in at most dealerships. This will maximise your return on the car.

PCP and HP options look very similar, but if you choose PCP the whole car won’t be covered. Cars lose value over time, and the amount you pay under PCP covers the depreciation throughout the length of the agreement.

Hire Purchase (HP)

Put simply, HP works by dividing the total cost of a car into repayments, made over a set period of time. HP payments will be offset by the amount of money you choose to put down as your deposit.

HP allows you to hire a car, with the option of buying it outright when the agreement ends. The car is owned by the lender, and it is used as security against the loan they have given you. In most cases, you have to pay a 10% deposit out of own funds, prior to the start of the finance agreement.

The price of your car is broken down into monthly payments, and you can choose contract terms between 12 and 60 months. Do be aware that you’re likely to pay more interest if you choose a longer payment term.

Once you’ve paid the final instalment at the end of your agreed period, you will own the car outright. In addition to paying monthly repayments, you also have to pay interest charges.

HP doesn’t take into account the depreciation levels of a car, so you will pay the same amount every month, regardless of its current market value.

How do I apply for finance?

Firstly, we recommend you work out an affordable monthly budget, and use that as a guide when choosing a car. We suggest that you don’t spend more than 10% of your take-home pay on finance.

A member of our team will get in contact with you to arrange delivery and choose a delivery slot. In addition, you will be able to discuss any optional extras you may wish to add.

The next step is choosing a finance deal that suits you - you will be asked to fill out a finance application. If you are approved by one of our lenders, we recommend you pay a deposit to reserve the car and then sign your documents.

How long does it take to get a financing decision?

We aim to give you a decision within a few hours, our team will be in contact with you to inform you on the lender’s decision.

What information is needed for a financing decision?

As part of your finance application, we will ask you to provide personal information covering the last three years. Examples include employment details, address history, bank details and a copy of your photo driving licence.

In some cases, you might be asked to supply supporting evidence, such as bank statements or payslips. 

Who is the finance provider and/or lender?

All of our finance applications are handled by Eurodrive Motor Finance. Who is one of the UK’s leading independent car finance specialists.