Car finance in Ireland: PCP vs Hire Purchase
Most people in Ireland buy a car on finance, and the two options you'll meet most often are PCP and Hire Purchase (HP). They work quite differently, and the right one depends entirely on how you like to own a car. Here's the plain-English version.
Hire Purchase (HP) — the simple one
You pay a deposit, then fixed monthly repayments over the term (typically 3–5 years). When you make the final payment, the car is yours — no strings, no mileage limits, nothing left to settle. Monthly payments are higher than PCP for the same car, because you're paying off the whole value over the term.
Suits you if: you want to keep the car for the long haul, you do high or unpredictable mileage, and you like the idea of simply owning it at the end.
PCP (Personal Contract Plan) — the flexible one
PCP also starts with a deposit and monthly repayments, but a big chunk of the car's value is parked until the end as a final lump sum — the “balloon” payment, or Guaranteed Minimum Future Value (GMFV). Because you're only financing the difference during the term, the monthly payments are lower.
At the end of the agreement you choose one of three paths:
- Pay the balloon and keep the car outright.
- Hand the car back and walk away (subject to mileage and condition terms).
- Trade in — use any value above the balloon as a deposit on your next car, and start again.
The catches to know: you don't actually own the car until you pay the balloon, there are mileage limits (go over and you'll pay per kilometre), and the car has to come back in good condition if you're handing it back.
Suits you if: you like lower monthly payments, you change your car every few years, and your mileage is predictable.
Side by side
| Hire Purchase | PCP | |
|---|---|---|
| Monthly cost | Higher | Lower |
| Final lump sum | None | Yes — the “balloon” / GMFV |
| Own it at the end? | Yes, automatically | Only if you pay the balloon |
| Mileage limits | No | Yes |
| Best for | Keeping the car long-term | Changing car every few years |
A simple way to decide
Ask yourself one question: do you want to keep this car, or swap it in a few years? If you're a keeper, HP is usually the cleaner fit — higher monthlies, but it's yours at the end. If you like driving something newer more often and want lower monthly payments, PCP gives you that flexibility, as long as you stay inside the mileage limits.
Whichever you choose, the smartest move is to start from the right car at the right price — that's what the Deal Rating on every AutoGenie listing is for.