If HP payments on a pickup are too high, there are two ways to lower them: lease purchase and PCP. Both defer part of the cost to a final payment, but they work very differently at the end. Which you can get depends largely on whether you’re buying for work or personally.
In short
Lease purchase and PCP both lower your monthly payments by holding back part of the cost until the end. With lease purchase, the final payment is compulsory and you carry the risk if the pickup is worth less. With PCP, the final payment is optional and guaranteed, but PCP is only offered on some pickups, usually to personal buyers.
How lease purchase works on a pickup
Lease purchase is a form of hire purchase with a large final payment. You pay a deposit, lower monthly payments and then the final payment, after which you own the pickup. It’s the most common way for businesses to lower payments on a pickup. It works the same way as van lease purchase.
- Deposit£3,200 upfront
- Monthly payments48 × £566.94
- Final payment£10,000, then the pickup is yours
- £3,200Deposit8% of total
- £27,213Monthly payments67% of total
- £10,000Final payment25% of total
Total you pay: £40,413, including £8,413 interest.
Worked example
A pickup costs £32,000 (excluding VAT). You pay a £3,200 deposit and borrow £28,800 over 48 months at an illustrative APR of 10.9%, with a £10,000 final payment.
- Monthly payment: about £566.94, around £169 less than HP
- Total including the deposit and final payment: about £40,413, around £1,892 more than HP
These figures ignore VAT and fees and are not a quote.
PCP on a pickup
Some manufacturers and dealers offer PCP on pickups, mainly to personal buyers. It works like car PCP: the lender sets a guaranteed final payment, and at the end you can pay it and keep the pickup, hand it back or part-exchange it. Because the final payment is guaranteed, you can hand the pickup back even if it’s worth less, as long as you’re within your mileage limit and it’s in good condition.
PCP mileage limits matter more on a pickup if you tow or drive long distances, so agree a realistic limit at the start.
Lease purchase vs PCP
| Lease purchase | PCP | |
|---|---|---|
| Final payment | Compulsory | Optional |
| Guaranteed? | No | Yes |
| Hand back instead? | Not usually | Yes |
| Mileage limit | Usually none | Yes |
| Usually offered to | Businesses | Personal buyers |
Pros and cons
Pros
- Lower monthly payments than HP
- Lease purchase: you own the pickup after the final payment, usually with no mileage limit
- PCP: the final payment is guaranteed, so you can hand the pickup back if it’s worth less
- Both help cash flow on an expensive vehicle
Cons
- More interest overall than HP
- Lease purchase: the final payment is compulsory and not guaranteed
- PCP: mileage limits and condition charges, and limited availability on pickups
- You need a plan for a large final payment
Lease purchase and PCP FAQs
Can a business get PCP on a pickup?
Rarely. Businesses are usually offered lease purchase or leasing instead.
What if my pickup is worth less than the final payment?
On PCP, you can hand it back and owe nothing more, subject to mileage and condition. On lease purchase, you still have to pay the final payment in full.
Which costs less overall?
Usually standard HP, because you clear the balance as you go. Lease purchase and PCP cost more in interest because you’re borrowing the final payment for the whole term.