Compare HP Car finance quotes (UK)

Compare HP quotes with confidence in 2025

HP can give you fixed monthly payments and full ownership at the end. Use this guide to compare quotes, understand APRs, and decide whether HP or PCP suits your plans and budget.

Understanding APR is about real pounds and pence - what you will repay overall.

Is this you?

Ideal if you want to own the car outright, dislike mileage caps, and prefer predictable budgeting. Useful for high-mileage drivers, commuters, families keeping a car long term, and buyers rebuilding credit who still want competitive finance options.

The finance language decoded

• Hire Purchase (HP): You pay a deposit, then fixed monthly payments over 1-5 years. When the last payment clears, the car is yours. No mileage limits. No balloon payment.
• Personal Contract Purchase (PCP): Lower monthly payments, but a large final payment if you want to keep the car. Mileage and condition rules apply.
• Deposit: Typically around 10% for HP. A higher deposit cuts monthly cost.
• APR: The annual percentage rate covering interest and some charges. In 2025, representative HP APRs often range 8.9% to 19.9% depending on lender, credit profile, vehicle and term.
• Term length: Usually 1-5 years. Longer terms reduce each instalment but increase total interest paid.
• Total repayable: The full amount you will pay over the term - deposit plus monthly payments and interest. Always compare this figure across quotes.
• Eligibility check: Many platforms offer soft checks that will not affect your credit score.

Quick reminder: Both HP and PCP are regulated in the UK, with consumer protections under the FCA. Always verify the provider is authorised.

Your main choices explained

HP vs PCP at a glance

Why pick HP

• Full ownership with no balloon payment
• No mileage restrictions - suitable for long commutes
• Straightforward budgeting with fixed monthly instalments
• Often accessible for varied credit profiles, as the car secures the finance

Why consider PCP instead

• Lower monthly payments if cash flow is tight
• Flexibility to hand back or upgrade at term end
• Useful if you change cars every 2-3 years

What it really costs

• APR range: Representative HP rates often sit between 8.9% and 19.9% in 2025.
• Deposit: Around 10% minimum is common. Paying more up front reduces monthly cost.
• Term: 1-5 years. Longer terms lower monthly payment but increase total interest.
• Total repayable: The key number. Compare this across quotes to find the value, not just the monthly figure.

How deposit and term shape payments

Note: Some lenders and manufacturers offer low APR or 0% HP on selected models. These may require larger deposits or shorter terms. Always confirm eligibility and the total repayable.

Can you qualify?

• Credit profile: HP can be more accessible than some products because the car is the security. Expect higher APR if your credit history is weaker.
• Vehicle: Lenders assess car age, mileage and value. New and nearly-new vehicles can unlock sharper rates.
• Affordability: Lenders review income, expenses and existing commitments. Be ready with payslips, bank statements and proof of address.
• Deposit: Around 10% is typical. A larger deposit may improve acceptance and pricing.
• FCA checks: Choose authorised lenders or brokers. Look for clear pre-contract information and an explanation of fees and commissions.

If a quote looks unusually cheap, check for fees, term restrictions and optional extras bundled into the deal.

From quote to keys - the practical steps

1. Set your budget and preferred term and deposit.
2. Get soft-search eligibility checks on comparison platforms.
3. Collect at least three HP quotes from UK lenders.
4. Compare APR, fees and total repayable side by side.
5. Review terms - mileage rules, if any, and early settlement.
6. Verify provider is FCA authorised and check complaints record.
7. Finalise documents, confirm affordability, sign the agreement.
8. Take delivery and keep copies of all paperwork.

The trade-offs that matter

HP delivers clarity and ownership certainty, with fixed payments and no mileage caps. The compromise is usually higher monthly instalments compared with PCP. If you drive high mileage or intend to keep the car beyond five years, HP often proves cheaper in the long run than rolling frequent PCP upgrades. If cash flow is tight and you prefer frequent changes, PCP may be more comfortable month to month.

Red flags and common pitfalls

• Mis-sold finance risk: Ensure you understand commission structures and whether they influenced the rate. Check documentation before signing.
• Focusing only on the monthly figure: Always compare the total repayable.
• Overlong terms: Smaller instalments can mask a higher overall cost.
• Negative equity: Be cautious when part-exchanging early.
• Early termination: Voluntary termination and early settlement are possible, but fees or conditions can apply. Read the small print.

If HP is not a fit

• PCP: Lower monthly payments, but mileage limits and a final balloon to keep the car.
• Personal loan: Unsecured finance may offer competitive rates for strong credit and gives immediate ownership.
• Leasing (PCH): Fixed monthly rental with no ownership. Good for those wanting new cars every few years.
• Cash purchase: No finance costs if you have the funds, but consider opportunity cost of cash.

FAQs

Q: What APR should I expect for HP in 2025? A: Representative rates often range 8.9% to 19.9%, depending on credit profile, lender, car and term.

Q: Is HP better than PCP for high-mileage driving? A: Yes. HP has no mileage limits, so you avoid excess mileage charges common with PCP agreements.

Q: Can I settle an HP early? A: Usually yes. You can request an early settlement figure or use voluntary termination subject to terms. Charges or conditions may apply.

Q: Do 0% HP deals really exist? A: They do on selected new models, typically with larger deposits and shorter terms. Always verify eligibility and total cost.

Q: Will comparing quotes hurt my credit score? A: Many digital brokers use soft checks for initial eligibility that do not impact your score. A full application uses a hard search.

Q: Can I get HP with poor credit? A: Often yes, since the car is security. Expect higher APR and be careful to check affordability before committing.

Take action with a clear plan

• Gather three to five HP quotes using UK comparison platforms.
• Compare APR, fees and total repayable - not just monthly cost.
• Adjust deposit and term to balance monthly affordability with total interest.
• Confirm FCA authorisation and understand early settlement options.

Ready to compare? Start with soft-search tools to check eligibility without affecting your credit score.

Important information

This guide provides general information, not financial advice. Always assess affordability and read pre-contract documents. Check FCA authorisation, complaint routes and your rights under UK consumer credit law before entering any agreement.