Ford Finance & Lease Options

Here at Group 1 Ford, we believe that everyone should have the opportunity to drive away in a brand new car. Getting a new or used Ford car on finance makes that possible. All you have to do is choose which plan is best for you or your business. Speak to our friendly expert staff to find out how you can drive away in a Ford car today.

Why Finance Through a Group 1 Ford Dealership?

• Finance packages available across the Ford range
• Range of finance options to suit your budget
• Benefit from comprehensive aftersales
• Excellent customer service
• Simple application process

Also known as a personal contract plan, Personal Contract Purchase makes it easier for you to get behind the wheel of a brand new Ford. Ford PCP is a form of hire purchase vehicle finance for individuals and is very similar to a Hire Purchase agreement. You will usually have to pay for an initial deposit, followed by monthly instalments. 

PCP differs from a Hire Purchase because you don’t pay off the vehicle’s entire value. Instead, the monthly payments pay off the loss in value of the car during the course of the contract. Should you wish to keep the car at the end of the agreement, a final balloon payment must be made.

At the beginning of all PCP contracts, the car’s expected value when your contract ends, which is known as the Guaranteed Minimum Future Value (GMFV), is set. This means that you will repay the depreciation - the difference between what the car is worth now and what it will be worth at the end of your contract.

Your monthly repayments will cover the cost of the vehicle depreciation and interest, which is calculated on the full value of the vehicle. So, you’ll have lower monthly repayments, but you will need to make a final payment (the Guaranteed Minimum Future Value) at the end of the contract should you want to keep the car.

In most cases, you can usually settle your PCP deal early, but you may be required to pay the negative equity – the difference between what your car is worth now, and what you still owe.

However, you may find that your car is in fact worth more than the Guaranteed Minimum Future Value (GMFV). In which case, you may find that you’ll have some positive equity at the end of the agreement. You can put this towards the cost of your next Ford car.

Once your PCP contract with ThinkFord comes to an end, you will have three options:

• Buy the car – Pay the final balloon payment (the Guaranteed Minimum Future Value) and the car is yours. No more monthly repayments.
• Give the car back – The Guaranteed Minimum Future Value of the car has already been set, so handing the car back will settle the costs.
• Part exchange for a brand new Ford car of your choice.

Pros:

• Monthly payments tend to be lower than if you were to choose a Hire Purchase agreement.
• You can drive away in a new or used car every couple of years, without having to sell it on.
• Don't want to buy the car at the end of the agreement? Just walk away.
• If the vehicle is worth more than the GMFV at the end of the contract, you can use the equity towards a deposit for a brand new car.

Things to be aware of:

• Insuring and maintaining the car is your responsibility.
• All finance must be settled before you can sell the car.
• You must make all of the repayments before you can own the car.
• If you exceed the agreed mileage, there may be excess charges.
• You must pay the GMFV of the car if you wish to buy it.

A Hire Purchase agreement allows you to pay for a new or used car by paying a deposit and monthly installments. Unlike PCP, your monthly payments will cover the cost of the entire value of the vehicle. At the end of the agreement, once all payments have been made, you will then have full ownership of the car.

Always consider your options before entering into a finance agreement. A Hire Purchase agreement isn’t always the best option for everyone. Make sure you know the pros and cons of HP before you enter into a finance contract.

Hire Purchase allows you to put down a deposit on the new or used Ford car you would like to buy. The deposit is usually 10% of the vehicle’s value. You will then have to pay the rest of the car’s value in monthly instalments over an agreed period of time. 

A HP agreement can last from 12 to 60 months - up to five years. When the agreement has ended and you have paid all of the instalments, the car is officially yours to keep. So, if you want to sell it on, you can.

The rates for Hire Purchase are generally very competitive. In order to get the lowest interest rates, you will need a good credit rating.

You have the right to terminate a HP agreement and return the car early if you have paid for at least half of the vehicle’s value. If you have paid less than half of its value, you can make up the difference between what you have already paid off and half of its cost.

If you have paid more than half of the car’s cost, you won’t be entitled to a refund. 

What happens when the finance ends?

Once you have made your final monthly payment, you will have full ownership of the car. And, as the owner of the car, you can choose what you do with it. Whether you want to keep or sell it on, it’s up to you. You will no longer need to uphold any part of the contract because the financial agreement will have ended. 

If you would like to sell the car and enter into a new finance agreement, the choice is yours.

Pros

• There’s no need to estimate your mileage at the beginning of the contract, so you’ll avoid any excess charges.
• Drive away in a brand new Ford car that you might not have been able to pay for outright.
• Once you have made your final monthly payment and the option to purchase fee, you will then own the car outright.

Things to be aware of

• You will be responsible for insuring the car, making sure that it is properly maintained and that it is in your possession until the full value has been paid.
• You cannot sell the car until the finance has been settled.
• Monthly payments could be higher than other finance options because you are paying for the full value of the car.

A cost-effective personal lease, Personal Contract Hire gives you access to a new Ford car over an agreed period of time. The duration of a Ford PCH agreement typically lasts from 24 to 60 months, depending on the deal you choose. 

Unlike PCP and HP, Personal Contract Hire gives you the option to include vehicle service maintenance and repairs, so you can budget effectively for your motoring costs. At the end of your agreement, you will need to return your Ford car to us. You won’t have the option to own the car, but you can easily replace it with another one.

You must return your car in a good condition or you may incur extra charges.

Also known as personal leasing, Personal Contract Hire is a long-term rental agreement. It’s becoming a popular alternative to buying brand new cars. Throughout the duration of your contract you will have to pay ‘rent’ for the vehicle in monthly instalments.

Usually, you will have to agree to a set amount of mileage for the duration of your lease. If you go over the mileage limit you will have to pay an excess mileage charge as part of your contract.

At the end of the agreed duration, you will have to return the car to us. As it is a rental agreement, there is no option to make a final payment to own the car. You won’t gain any valuable assets from a PCH finance deal.

If you wish to end your PCH agreement early, you can agree to hand back your vehicle for a set fee. Leasing deals are not designed to be broken, so there is usually a penalty for leaving the contract prior to the agreed end date. It is always worth considering whether returning your car early is beneficial to you.

No Personal Contract Hire agreement can be ended early unless you have paid £1,500 inc VAT of the rentals. If you have already paid that amount in monthly rentals, then you can return the car early. Should you choose to return your vehicle after you have paid more than the agreed amount, then you will not be entitled to a refund.

What happens when PCH ends?

At the end of the PCH contract, you must return the vehicle to us. You are free to hire or purchase another vehicle, as there is no outstanding financial obligation. 

However, if you have exceeded your agreed mileage that was set out at the start, you will have to pay an excess mileage charge. This will be worked out on a ‘pence per mile’ basis, as stated in the terms of the agreement.

When you return the vehicle, it will be assessed according to the BVRLA Fair Wear and Tear guidelines. If the vehicle has sustained any damage that falls outside of these guidelines, you may be held liable and face penalty charges.

Pros

• Drive away in a brand-new Ford vehicle on low monthly payments.
• No need to worry about selling the car at the end of the agreement.
• Monthly payments are fixed and will never change.
• You won’t have to worry about the car losing its value.

Things to be aware of

• If you return the vehicle damaged, you may have to pay extra charges to cover the cost of repairs.
• You may have to pay an exit fee if you wish to end the agreement early.
• You will be charged for an excess mileage if you exceed your agreed limit.

A contract purchase is for businesses who want to own their vehicles without the risk of depreciating assets. It’s a finance agreement for VAT registered companies. A Ford BCP agreement is ideal for businesses who run expensive vehicles who don’t want the worry of losing the value on their cars. Simply choose a brand new Ford car, then pay a deposit followed by monthly installments and put your new business vehicle to good use. 

It is important that you consider all business finance options before entering an agreement, as BCP may not be the best choice for your company. 

Whether you are looking for a single car or a whole fleet, BCP allows your company to lease vehicles on a contract purchase basis. You will have to pay for the vehicle in monthly installments over an agreed duration of 24 to 48 months, for example. 

If your business is a VAT registered company, you will not have to pay VAT on the monthly payments. However, if you take out an optional maintenance package, you will have to pay VAT on any service costs. 

Once the contract comes to an end, your business then has the option to purchase the car based on its Guaranteed Minimum Future Value (GMFV). This is known as a final balloon payment, which can be paid as long as the terms of the agreement have been met.

Customers are not obliged to purchase the vehicle at the end of the agreement. However, the option to buy is there should you wish to do so. When a Business Contract Purchase agreement expires, there are three options available:

• Return the vehicle to the dealership
• Pay the final balloon payment and own the vehicle outright
• Refinance the final rental amount by paying the balloon payment in monthly instalments. Once these payments have been made, you will then own the vehicle

Business Hire Purchase, also referred to as business lease purchase, is a finance agreement, offering vehicle funding for companies who wish to buy a new or used Ford car, but don’t want to spend the money up front. BHP is purley a finance package, so it does not include maintenance or other added-value services that you would expect from a business contract purchase agreement. 

A Business Hire Purchase finance agreement is not always the best option for every business. It is important to review your options before committing to the contract.

As part of a Business Hire Purchase agreement, you will be required to pay an initial deposit followed by monthly instalments throughout the duration of the agreed contract length. The deposit and monthly payments are calculated using the retail value of the vehicle, the length of the contract and the estimated residual value of the vehicle at the end of the contract.

Once the lease purchase agreement has begun, the vehicle will belong to your business. However, the car must be purchased at the end of the agreement with a final balloon payment. The slower the vehicle’s value depreciates, the better deal you get because your business will take on the residual value of the car. 

When the Business Hire Purchase agreement ends, your company will be required to pay a final balloon payment and will take full ownership of the car. Upon signing the agreement at the beginning of the contract, your business agrees to purchase the car at the end of the agreed duration. Your company will not be given the option to return the vehicle and you are liable for the full value of the car.

A form of leasing, Business Contract Hire allows your company to drive the vehicle over an agreed periods of time, with a set mileage allowance. It’s a cost-effective way to gain access to new vehicles without any large drops in value that you would normally associate with having full ownership of a new car.

There is the option to include vehicle service maintenance and repairs in your BCH agreement. It gives you the room to budget for all of your business motoring with ease. To be able to take out a BCH agreement, your company has to a sole trader, partnership, limited company or a public limited company.

Businesses can finance new or used Ford vehicles with an agreed minimum down payment and a mileage allowance. The minimum down payment is usually equal to three monthly instalments, and it must be paid in advance.

The mileage allowance is agreed in advance, the minimum being 10,000 miles per annum and  a maximum of 40,000 miles per annum. If you go over the mileage allowance the excess mileage rate is charged. You will be billed for this at the end of the contract.

BCH is subject to VAT, 50% of which can be claimed back. Once the agreement is over, the vehicle must be returned to the dealership in good condition. Any damage that has been sustained will be charged for.

At the end of your Business Contract Hire agreement, your business will have 2 options to choose from: 

• Return the vehicle to the dealership
• Extend the leasing agreement with the dealership

Your company will not have the option to purchase the vehicle, and will gain no valuable assets. When returning the car, it should be given back in a condition that meets the standards of the BVRLA ‘Fair wear and tear’ guidelines. If it does not, you may incur extra charges.