HONDA PCP FINANCE
Personal Contract Purchase is a finance product offered by Honda Financial Services that provides a flexible funding solution to get you on your new motorcycle and out on the road with monthly payments that are lower than some alternative finance products.
How it works
PCP is one of two finance products available to you from Honda Financial Services to help fund your Motorcycle.
PCP allows you to keep your monthly repayments lower by deferring a proportion of the credit to the end of the agreement, and also giving you the flexibility of 3 options at the end of the agreement.
So, how does this work?
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Firstly, choose the motorcycle you want, and agree how much deposit you would like to put down.
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Then, estimate how many miles you will ride each year, and then agree how long you would like your agreement to run, between two and four years.
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Then, estimate how many miles you will ride each year
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We will then use this information to calculate a Guaranteed Future Value [GFV] – this is what we predict the value of your motorcycle to be worth at the end of the agreement.
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The Guaranteed Future Value is deferred until the end of your agreement.
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Because this value is based on your estimated annual mileage, it is important to give an accurate estimate, as you may have to pay excess mileage charges if you exceed your total agreed mileage for the agreement.
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Your monthly payments are worked out on the difference between the GFV and the price of the motorcycle once your deposit has been taken off and interest added. This means you have lower, fixed monthly repayments than with Hire Purchase.
You decide
At the end of your agreement you have the flexibility of 3 options:
Retain - You can keep your motorcycle – pay the final payment and the option to purchase fee, and you will own the motorcycle outright
or
Return - You can hand your motorcycle back to us without paying the final payment – if you have exceeded your agreed mileage or the motorcycle is not in a good condition, then there may be additional charges to pay. Excess mileage charges will be explained before you sign the agreement, so you will know what these may be if you go over your estimated mileage.
And finally your third option is,
Renew - You can part exchange your motorcycle and subject to market value conditions, this should cover off the cost of the final payment. Then together with your Honda dealer, you can start looking for your next Honda.
Choose the right product
Personal Contract Purchase may not be right for you so please review our other finance products or speak to your Honda dealer, to make sure you choose the right product to suit your needs.
It is important that the product you choose should provide a monthly payment that is sustainable, whilst also meeting your needs and circumstances best. Your Honda dealer will be happy to assist you with this.
Product Features and Considerations
There are some aspects of Personal Contract Purchase (PCP) that you need to be aware of to help you make an informed choice to decide if PCP is right for you.
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As your PCP agreement includes a Guaranteed Future Value (GFV) you have the ability to return the motorcycle to us (subject to the terms of the agreement). This provides you with some protection from market depreciation.
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You have the right to withdraw from your PCP agreement within 14 days from the start of your agreement. You can also partially or fully settle your agreement at any time (subject to the terms of the agreement).
Personal Contract Purchase (PCP) may not be the right product for you for the following reasons:
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If you are a high annual mileage user then PCP is unlikely to be suitable for you as there is a maximum total contracted mileage limit.
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If you prefer to change your motorcycle after more than 4 years then PCP may not be right for you as the maximum PCP term is 4 years.
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Interest is payable on the amount you borrow including the Guaranteed Future Value (GFV). The Total Amount Payable (the overall cost) is likely to be higher than a Hire Purchase agreement with the same loan amount and term, as your balance will reduce slower due to the deferred GFV.
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If you do more miles than you estimated and/or there is damage to the motorcycle, there may be additional charges if you decide to return your car to us.
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You are not guaranteed to have any equity at the end of the agreement, if market conditions mean your motorcycle is worth less than the GFV. This may mean you will require an additional deposit if you choose to part exchange at the end of the agreement.
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You will own the motorcycle outright once all regular payments, GFV and any option to purchase fees are paid.
Newcastle Motorcycles are licenced by the FCA (registration number 660607) as a non-independent credit broker. Newcastle Motorcycles has access to a limited number of lenders as a non-independent credit broker. Finance available subject to credit acceptance to UK residents aged 18 or over. Guarantees and indemnities may be required. Terms and conditions apply. Offer may be varied, withdrawn or extended at any time. All figures are correct at time of publication but may be subject to change. What does this mean? Essentially, we’re non-independent because we only work with a limited number of finance providers and cannot search nor advise on the whole market for your best option to fit your circumstances. What’s a credit broker? We make introductions on your behalf to a limited number of lenders, but we are not the lender itself. Meaning for example, when you take out finance on a new Honda motorcycle we may introduce you to Honda Finance Europe (the lender) and your finance agreement is between you and them. We are not an independent financial advisor. We may advise you on the products, subject to your personal circumstances, though you are not obliged to take our advice or recommendation. What about fees and commission? We don’t charge you a fee for an introduction to a lender, however the lender typically may pay us commission for a successful introduction. We do not charge you a fee for our services. Whichever lender we introduce you to, we will typically receive commission from them (either a fixed fee or a fixed percentage of the amount you borrow). The lenders we work with could pay commission at different rates. However, the amount of commission that we receive from a lender does not have an effect on the amount that you pay to that lender under your credit agreement.” All of our finance is offered at the same rate to each customer, we don’t vary the rate. How am I scored? Different lenders have different methods of scoring you for your suitability of your finance application. We are not privy to the score, nor how they arrive at it. We only get notification of an acceptance, referral or decline. If you want to speak to any of the finance providers, their details are below. If you want to make a complaint Please telephone or write to the following address in the first instance. We’ll endeavour to resolve any complaint quickly and painlessly. If you want to write to the finance houses directly, please see the details below Newcastle Motorcycles Ltd, Dealer Principal, 195-199 Scotswood Road, Newcastle. NE4 7DD Tel: 0191 282 2868
