finance ToolUpdated 2026-09-20

Car Finance & PCP Calculator

Plan your next vehicle purchase with our free car finance calculator. Compare monthly installments, total borrowing costs, and final balloon payments (Guaranteed Future Value).

Formula & Mathematical Methodology

Monthly PCP = (Financed Amount - GFV) ÷ Term + Average Monthly Finance Charge

Under a PCP contract, your monthly payments cover only the depreciation between the borrowing amount and the Guaranteed Future Value (GFV), plus interest across the agreement.

Step-by-Step Worked Example

Scenario: $28,000 car, $4,000 deposit, 48 months at 6.9% APR with $11,000 balloon.

1. Financed amount: $28,000 - $4,000 = $24,000.

2. Depreciation to fund: $24,000 - $11,000 = $13,000.

3. Monthly depreciation installment: $13,000 ÷ 48 = $270.83.

4. Average monthly finance charge at 6.9% APR: $100.63.

5. Estimated monthly PCP payment: $270.83 + $100.63 = $371.46.

Final Calculated Result: $371.46 / month

Frequently Asked Questions

What happens at the end of a PCP agreement?

At the end of a PCP contract you have three choices: 1) Pay the optional balloon payment (GFV) to keep the car, 2) Return the car with nothing more to pay (subject to mileage and condition), or 3) Trade in the car using any positive equity toward a new contract.