What is Personal Contract Purchase?	Features of Personal Contract Purchase
Personal Contract Purchase (PCP) is a method of funding where an individual leases a vehicle for a set period at a fixed monthly charge. At the end of the contract, the individual can choose to either make a payment to acquire the car or return the vehicle to the finance company, assuming terms and conditions have been adhered to. The monthly rental is determined by the cost of the vehicle, the duration required and the estimated residual value of the vehicle, which is based on the expected annual mileage.	Low initial payment, as negotiated Fixed rental allows for predictable and budgeted costs and cash flow Option to own the vehicle at the end of the contract term or finance company carries the residual risk and cost of disposal Depending on payment plan, there may be a balloon payment at end of the contract term A range of maintenance packages are available from servicing to full vehicle management No company car tax to pay The agreement is covered by the protection set out in the Consumer Credit Act, but only if the vehicles is under £25,000 in value.