Refinance Balloon Payment

How to Refinance PCP Balloon Payment:

Refinancing a PCP balloon payment with UK Car Finance is simple and stress-free. We work with a panel of trusted lenders who offer balloon payment loans, and our finance experts are dedicated to providing top-notch service every step of the way. 

Before refinancing, you’ll need a settlement figure from your current lender so our panel can clear the outstanding balance. Then, refinancing your balloon payment is just three easy steps:

3. Keep Enjoying The Car You Love.

Many drivers refinance their balloon payments because they want to keep their current car. We’ll help you secure the best possible refinancing rate, so you can continue enjoying your car without financial stress.

What is a PCP Balloon Payment?

A PCP (Personal Contract Purchase) deal is a popular way to get a new or used car with lower monthly payments. Unlike other finance options, such as hire purchase, PCP doesn’t spread the full cost of the car across the term. Instead, you pay the difference between the car’s purchase price and its expected value at the end of the agreement.

It’s a common misconception that you can’t own a car on PCP. In fact, at the end of your contract, you have the option to make a final payment — known as a balloon payment — if you want to keep the vehicle.

For example, if you buy a car for £20,000 and it’s expected to be worth £8,000 at the end of the term, your monthly payments cover the £12,000 difference. The remaining £8,000 balloon payment is optional if you choose to keep the car. Many drivers cannot pay this lump sum outright, which is where PCP balloon payment refinancing becomes a helpful solution.

Can You Refinance a Balloon Payment?

Yes — and we can help! If you’re on a PCP agreement and want to keep your car but can’t afford the lump sum balloon payment, refinancing is a smart solution. At UK Car Finance, we work with a bespoke panel of lenders who specialise in PCP final payment finance.

You don’t need to refinance with your current lender. Sometimes, your existing lender may not offer balloon payment finance due to your credit history, or their rates may not be the most competitive. By exploring other lenders with us, you can secure a lower interest rate, ensuring you don’t pay more than necessary to refinance your PCP final payment.

Refinance options we can offer through our lending panel: 

• Refinance of a PCP balloon payment.
• A right of withdrawal or early settlement (subject to entering into a new agreement that is better for your financial situation).
• Purchasing a vehicle at the end of a contract hire agreement.

​Should You Finance Your Balloon Payment or Hand the Car Back?

Deciding whether to refinance your PCP balloon payment or return the car to the dealer depends on a few key factors. Start by comparing your car’s current market value with the final balloon payment amount.

• If your car is worth less than the balloon payment, returning it to the dealer may be the better option, as refinancing could leave you out of pocket.

• If your car is worth more than the balloon payment, you may benefit from paying it off or refinancing, allowing you to keep a vehicle that’s still valuable.

Not sure how much you can borrow? Use our Balloon Payment Refinancing Calculator to see your options and make an informed decision.

Refinance Your PCP Balloon Payment Today!