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What is Personal Contract Hire?

Cars are one of the most popular forms of transport in the world. Having the freedom to drive where you want, when you want, is something that never gets old. Personal Contract Hire makes the use of a vehicle a lot more straightforward and affordable when compared to buying a car outright.

Personal Contract Hire is similar to other contract hire agreements with the main difference being that it only applies a specific individual rather than a business. It is one of the most popular ways of leasing a car that is normally associated when a person talks about car leasing in general.

When you have a Personal Contract Hire agreement, you can drive a car for an agreed period of time. This duration is known as a 'lease period'. Even though the car is actually in your possession, you do not own it.

You make monthly fixed rentals for the time period that you contract runs. Once the contract has completely finished, you return the car.

People find this agreement appealing as it means that they don't have to worry about the eventual resale value of the actual car. As you don't actually own the vehicle, once your contract is finished you can walk away without any extra obligations.

Who is Personal Contract Hire for?

A lease is calculated on the difference between the initial purchase price and the residual value of the vehicle. At the end of your contract you have to give the car back and simply and take out a new lease, instead of gambling on the used car market hoping that your car hasn't depreciated massively.

Basically with personal contract hire you don't have to worry about depreciation, warranty or vehicle disposal at the end of the contract. Car leasing is effectively a long term rental. You pay a fixed monthly rental to use the car for an agreed amount of time and mileage. Our customers simply budget a monthly vehicle expense to drive a different new car every two to four years

If you are a person that has to travel a lot, your mileage will increase. This means that the depreciation will increase, meaning a higher monthly rental. It is important to note that the monthly rentals you have are fixed, meaning that it's more accommodating compared to actually buying a vehicle.

A lot of people prefer to have a new car on a regular basis but can't afford to, if this is the case, a Personal Contract Hire agreement is the best option for you. After a contract is finished you are able to able to start a brand new agreement on the same day. We have a wide range of vehicles to choose from, so you will never struggle for choice.

What are the benefits of Personal Contract Hire?

Fixed costs

One of the main reasons that a person will choose to lease a car is the fixed costs. As you understand how much the monthly rentals will be before the contract even begins, you'll be able to budget properly without any surprising costs appearing out of nowhere.

Less obligations

One of the great things about Personal Contract Hire agreements is the fact that you have very few obligations to take care of. As you don't own the car, you won't be selling it by the end of the agreement. This completely avoids the pedantic job of putting the car on the market, letting potential buyers see the car and actually selling it. All you have to do is return it to is and the agreement is finished.

You also have the choice to add a maintenance package along with your Personal Contract Hire agreement. This means that you don't have to worry about any of these aspects of the vehicle, giving you another thing that you don't have to worry about.


One of the main points in taking out a Personal Contract Hire agreement is that it's a convenient way to use a car. A lot of people get turned off driving a new car because of large the upfront costs and all of the maintenance that occurs later on down the line.

The upfront costs for leasing a car are usually lower than buying a car, and the monthly rentals can be smaller compared to getting a loan, as a loan for a car is usually more expensive.

Lease Car and You

One of our main goals at Lease Car is to make sure that you end up with a contract that is best suited to your needs. We have a variety of cars that can be a great addition to anybodies life.

If you've always wanted a car, or simply don't want to pay the fees that happen with owning a vehicle, car leasing is the best option for you. If you have any questions at all, get in contact today and we can get you sorted with a car best tailored for you.

Personal Contract Hire Made Easy

Trying to decide which long-term car rental agreement is right for you can feel daunting. There are various ways to lease a car, each with its own set of pros and cons and each suited to different customer needs. Add to this the varying contract options offered by different leasing companies, and there’s a lot of information to take in and plenty of decisions to be made.

LeaseCar has been providing Personal Contract Hire car finance for over 25 years, so we know the market inside out. It’s a sector that changes quickly: Hundreds of new cars are launched every year as well as new deals with different contract options. That’s why we keep our knowledge up to date and ahead of the game. We’re committed to providing you with the best advice to help you choose the right deal - with us, you’ll get the car of your dreams at a monthly price you can afford.

This page will provide you with a good overview of Personal Contract Hire, as well as look at:

  • How monthly rental costs are calculated
  • PCH agreement options available
  • Difference between PCH financing and other leasing solutions

If you’d like to chat with a member of our friendly LeaseCar team or have any questions, we’re just a phone call away.

What is Personal Contract Hire Car Finance?

Personal Contract Hire car finance is often a good choice for individual drivers looking to lease a car, as long as buying the car at the end of the lease isn’t what you’re looking for. If you need a car for both personal and business use, a Business Contract Hire agreement is probably the better option for you.

You can choose a 2, 3 or 4-year contract to suit your future plans. You don’t have to pay a deposit - good news if you’d rather keep your money in your pocket - and you’ll enjoy low monthly costs. You could be behind the wheel of a car that you couldn’t afford with other types of rental or purchase agreements because your budget goes further. When we tailor your lease options to suit your individual needs, we’ll agree on an annual mileage allowance - why pay higher costs if you’re not putting in a lot of miles?

Throughout your contract, you pay a fixed monthly rental, which covers the depreciation on the car. Your monthly costs includes your road tax and, as you’re leasing for personal use, the VAT is included. You can also add a maintenance package if you’d like the added peace of mind of knowing you’ll have no surprise garage bills. Read the BVRLA ‘Fair Wear and Tear’ guidelines here.

Unless you choose an insured lease deal, sorting out your comprehensive insurance is still down to you but, if you’re trying to keep your policy costs down, we’re happy to help you select a car that’s cheaper to insure than other models.

When your contract ends, you simply hand back the keys (and the car!) and either walk away or choose a brand-new car and lease deal. You don’t have the option to buy the car so there is no hefty balloon payment to budget for or worry about.

Is a Personal Contract Hire Agreement Right for Me?

Personal Contract Hire enables you to drive a car that puts a smile on your face while keeping costs low. You can drive a brand-new car knowing that your payments are fixed for the duration of your contract and you’re covered by a market-leading warranty. There’s no deposit to pay either. Less pressure on your finances means that better cars become more affordable.

Other types of lease agreements, such as a Personal Contract Purchase, usually demand higher monthly payments. Borrowing money from a finance company is also typically more expensive whereas outright purchase with your own cash means your bank account takes a big hit.

Added Costs That Come with Purchased Vehicles

Purchasing a car can also be a gamble, especially if you’re buying second-hand, as you don’t know the car’s history. You could be taking on a whole host of costly mechanical problems. If that sounds like a nightmare you’d rather avoid, leasing could be right for you.

Choosing to purchase also means taking on the task of selling the car when you’re ready for a new vehicle. This includes covering advertising costs, organising viewings if you’re selling privately and, if you part exchange, accepting an offer that’s often below your expectations.

All vehicles depreciate, but selling your cherished car can be heartbreaking when you realise just how much its market value has fallen. With a Personal Contract Hire agreement, the depreciation is worked out upfront and factored into your monthly rental. Depreciation rates can fluctuate over time, but you don’t have to worry about that - you won’t pay a penny more at the end of the agreed lease.

The car industry evolves and changes quickly. If you value improvements in performance, safety, efficiency and driver-comfort tech, leasing gives you the opportunity to enjoy all those developments as they happen rather than waiting around for the right time to sell your own car.

Find more answers to commonly asked questions here.

How Does Personal Contract Hire Differ from a Personal Contract Purchase?

If you’re researching car leasing options to decide on the best one for your needs, you might have come across Personal Contract Purchase deals. Personal Contract Hire and Personal Contract Purchase, sometimes called a Personal Contract Plan, are both popular ways of financing a car.

Before you make up your mind about the type of deal that’s right for you, make sure you’re clear on some vital details. Ask yourself:

  • What monthly payments can you afford?
  • Do you have spare cash to put down as a deposit?
  • Are you looking to purchase the car at the end of the contract?
  • What is your anticipated annual mileage?
  • How likely is it that your circumstances might change?

Let’s take a look at the key differences between the two types of agreements so that you can decide which one to explore further.

The Option to Purchase

Personal Contract Hire means renting a car for a set period of time. There is no option to buy the car at the end of the contract.

Personal Contract Purchase is a plan that gives you the option of buying the car at the end of the contract by paying a one-off balloon payment.

Money Matters

Personal Contract Hire offers lower monthly payments than agreements that allow the purchase of the car at the end of the lease. Unlike Personal Contract Purchase, no deposit is required, although you might have to pay an initial rental upfront.

Ending Your Agreement Early

If you choose a Personal Contract Hire agreement, finishing your agreement early or changing the options will result in additional charges.

Personal Contract Purchase deals often include the option to end the agreement early by paying off the difference between the amount you owe and the current market value of your car.

Benefits of Personal Contract Hire Car Finance Deals

Personal Contract Hire agreements have many perks, which is why more and more drivers are turning to them as their preferred way to finance a new car. Let’s summarise some of the main attractions:

They Take the Stress Out of Financing a New Car

Financing a car can be a real headache, not to mention time consuming. When you decide to use Personal Contract Hire to get behind the wheel of your new car, we’ll do all the work for you to make sure you get the best possible deal. You won’t have to worry about dealing with finance companies or applying for a bank loan.

At LeaseCar, we’ll pre-select deals that are the perfect fit for your circumstances, saving you the complex task of sorting through everything that’s available. You’ll make the final decision, but you’ll be choosing from the deals offering you the most attractive terms.

Drive the Car you Really Want, Not Just the Car you Can Afford

There’s no doubt that the car we drive isn’t always the car we dream of. Personal Contract Hire opens the door to more choices and higher specs as it offers low monthly costs that won’t change for the duration of your lease. This also makes it easier to plan your budget.

You can drive a brand-new car every 2-4 years, depending on the length of contract you choose. That means no worrying about the car’s previous history, and you’ll also be keeping up with all the new tech!

No Unexpected Maintenance Costs

When you decide to lease a car, you have the option of adding a maintenance package to your contract. This means fewer disruptions caused by unforeseen trips to the garage workshop, less time spent on booking mechanical services and peace of mind that you and your family are travelling in a safe, regularly maintained vehicle.

Find out more about the options for maintaining your vehicle.

No Resell Worries or Depreciation Shocks

There’s no need to worry about the hassle of reselling your car, and you’ll never have to suffer a hard hit in the pocket caused by unexpected depreciation. Just return the car to us and your agreement is complete.

Competitive Car Leasing Deals with LeaseCar

We’re one of the UK’s oldest and most trusted online car leasing companies. We make sure that every customer gets a deal that suits their circumstances and a car that’s going to meet their needs.

At LeaseCar, we’ll never offer a finance deal that we haven’t researched and we can give you unbeatable advice if you need help to decide on the right car. Our confidence in the quality services we offer means that we’ll always try to beat a cheaper deal if you’ve been offered one elsewhere.

Once you’ve chosen your car and lease agreement, we’ll sort out the necessary credit checks and finance package. When you’re happy with everything, we’ll get your car delivered to your doorstep fast and hassle-free. All you have to do is sit back and start planning your next road trip.

Take a look at our range of available cars and contact us to find out how Personal Contract Hire could work for you

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