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.
THE FINANCIAL CONDUCT AUTHORITY (FCA)
The FCA is the independent watchdog that regulates financial services. Please use this information to decide if our services are right for you.
We are authorised and regulated by the FCA and we act as a Credit Broker. Our FCA Reference Number is 668881. You can check this on the FCA’s Register by visiting the FCA’s website www.fca.org.uk/register or by contacting the FCA on 0800 111 6768.
Farnham Honda is the trading name for Bikenation MCS Limited, Unit 1 9a, Farnham Trading Estate, Farnham, Surrey, GU9 9NN.
DELIVERING A GOOD OUTCOME
We have an obligation to act to deliver good outcomes to our customers. We will do this by supporting you before, during and after the transaction. We will clearly explain to you any significant exclusion terms, all pricing information and your cancellation rights.
CONSUMER CREDIT DISCLOSURE
As a Credit Broker this means that we can introduce you to a limited number of lenders and their finance products. We act on behalf of the lender. We can provide you with a list of our lenders should you wish for. All our lenders are regulated by the FCA.
We do not charge you a fee for our services.
Whichever lender we introduce you to, we will typically receive commission from them. This will either be a fixed fee or a fixed percentage of the amount you borrow.
If you ask us what the amount of commission is, we will tell you in good time before the Finance agreement is executed. The lenders we work with could pay commission at different rates, but the commission we receive does not influence the interest rate you will pay. Our aim is to secure finance for you at the lowest interest rate you are eligible for from our panel of lenders.
All finance applications are subject to status which we will explain to you clearly.
Typically, the finance packages we offer are:
HP – Hire Purchase
PCP – Personal Contract Purchase
PCH – Personal Contract Hire
A full explanation for the different types of finance products available will be provided so you can make an informed choice. You will receive a quotation which will tell you about any other fees relating to your finance agreement made by your chosen lender.
WHAT TO DO IF YOU HAVE A COMPLAINT
If you wish to register a complaint, please contact us by email at HYPERLINK "mailto:cc@farnhamhonda.co.uk"cc@farnhamhonda.co.uk, by phone on 01252 8991800 or writing to The Complaints Team, Farnham Honda, 9A Farnham Trading Estate, Farnham, Surrey, GU9 9NN.
If you cannot settle your complaint with us, you may be entitled to refer it to the Financial Ombudsman Service.
