Electric Car Finance

Are you looking to buy an electric car on finance? We understand that finance can be confusing, especially when exploring the world of EVs. However, there’s a variety of electric car finance available, including flexible options such as PCP, HP and leasing. But, how do you know which is right for you? 

Below, our guide delves into the details of electric car finance. Alternatively, if you have any further questions, contact our team who’ll be happy to help.

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Electric car Personal Contract Purchase (PCP) is a popular funding option for new and used electric cars.

PCP stands for Personal Contract Purchase:

Personal – The agreement is for individual users rather than businesses

Contract – You agree to a contract over a fixed term, for example, between 24 and 48 months

Purchase – There’s an option to purchase the vehicle at the end of the agreement

Are you looking to buy an electric car on finance? We understand that finance can be confusing, especially when exploring the world of EVs. However, there’s a variety of electric car finance available, including flexible options such as PCP, HP and leasing. But, how do you know which is right for you?

Below, our guide delves into the details of electric car finance. Alternatively, if you have any further questions, contact our team who’ll be happy to help.

Most PCP finance deals last between 24 and 48 months. So, this gives you a flexible loan period to switch more easily. You can drive the latest electric vehicles every couple of years.

If you’re looking to drive the latest models at a lower monthly cost, EV PCP is a great option. This finance also offers a way to upgrade more regularly with low & locked monthly payments

The benefits of EV Personal Contract Purchase finance are:

Low monthly instalments – Payments are fixed and lower compared to other finance options.

Flexible terms – Agreements typically last between 2 and 48 months.

End of lease options – Choose whether to pay the balloon payment, trade-in your car or hand it back.

Regular upgrades – Upgrade your vehicle every few years with short-term loan options.

Protected against depreciation & inflation – No need to worry about any surprises charges or interest fluctuations.

Hire Purchase (HP) for electric cars is like a traditional loan where you pay fixed instalments for the car’s full value.

HP stands for Hire Purchase:

Hire – You don’t own hiring the vehicle until it’s paid for in full.

Purchase – At the end of the agreement, you own the car.

You pay a deposit which is flexible according to your budget. This is taken off the car’s value, and the remaining amount is split over the loan term with interest added.

At the end of the contract, you pay a nominal ‘option to purchase’ fee to own the car.

You can change your car at the end of the loan term, which is typically between one and five years.

HP EV finance is a top choice for drivers wanting to own a car longer than the loan period. There’s also no mileage limit, and you own the vehicle outright on the last payment.

The main benefits of EV Hire Purchase finance are:

Flexible terms – Loan periods range from one to five years, depending on your budget.

Low deposit – Around 10% of the car’s value is required to secure an EV, but you can put down less or more.

Fixed payments and interest – Your payments are locked in so you always know what you’re paying.

No mileage cap – Drive as far as you want with no worry of excess mile charges.

Small option to purchase fee – Pay a nominal fee between £100-£200, and the car is yours! 

Low-credit score friendly – Finance is secured against the car, so most drivers should be able to secure funds.

Electric car leasing gives you all the benefits of driving an EV for a monthly fee with regular upgrades. EV leasing offers pure convenience.

Electric car leasing is just like renting a car but for a longer period. Leasing terms are typically between 24 and 48 months. There’s an initial cost, usually the equivalent of six monthly payments. However, this is not a deposit and it forms part of the leasing contract.

You can change your car at the end of the leasing period, for example, every two to four years.

Electric car leasing is a great alternative to other finance options if you don’t want the hassle of owning a car outright. Monthly payments are slightly higher than PCP or HP loans. But you get road tax included in the cost and you can regularly upgrade cars. You can also include servicing in your monthly costs too.

The main benefits of electric car leasing are: 

Flexible terms – Choose between two to four-year contracts to suit your needs.

No deposit – The initial payment forms part of your lease agreement.

Fixed monthly payments – Instalments are locked in, so there are no surprise charges.

Easy to upgrade – Just hand the car back and select a new model, no hassles.

Include servicing – with the option to add servicing as part of your monthly payments, you have one less thing to worry about.

Alongside the variety of affordable ways to finance an electric car, there are numerous benefits to actually driving one. These include:

Zero emission driving – No tailpipe emissions means cleaner air for the community.

Cheaper to run – It’s typically cheaper to recharge at home than fill up at the pumps.

More affordable to maintain – With fewer moving parts, an EV costs less to maintain.

No road tax – All-electric cars are exempt from paying road tax, as VED is worked out based on tailpipe emissions.

Exemptions - Drive through Clean Air Zones, ULEZ, LEZ and Congestion Charges for free.

Owning an EV is easier than you might think. However, below are a few common questions that answer whether this type of car is suited to your lifestyle.

While it’s handy to have a charge point at home, other options such as on-street charging, public charging and workplace charge points make topping up easy.

Most EVs come with a standard wall socket. But the most effective and faster way to charge is via a wallbox. Getting one installed is easier than you think, and you may be eligible for the Electric Vehicle Home Charge Scheme.

Learn more about EV grants & incentives

Depending on the car model and charge point, EVs can take between 30 minutes and several hours to recharge. If you install a wallbox, charging overnight is a great option. This also allows you to schedule charges around your lifestyle.

But you if won’t have time to charge your electric car at home or on the go, you have a few other options.

Hybrids are a great alternative if you’re not ready to transition to an all-electric car just yet due to charging restrictions.

Plug-in hybrid cars

A plug-in hybrid utilises the power of an electric motor alongside an efficient combustion engine. These models are more affordable than full EVs and convenient for people driving long distances. This type of hybrid typically offers around 40 miles of pure electric driving.

Just plug it in to recharge and you’re good to go. This type of hybrid car is ideal if you have semi-regular access to a charging point.

Hybrid cars

Hybrid vehicles, also known as full or self-charging hybrids, don’t need to be plugged in to get the benefits of electric power. The motor boosts the engine efficiency and provides an all-electric range at slow speeds and short distances.

Regenerative braking works in the background to recharge the battery, with most hybrid cars offering electric-only driving too.

Mild-hybrid cars

Mild hybrid cars are the most affordable option for drivers looking to dip their toe in the EV market. The small electric motor is self-charging via regenerative braking, and this supports the engine for better fuel economy.

This type of hybrid powertrain doesn’t allow for electric-only driving, but instead assists the engine and powers electrical systems for added efficiency.

Making the switch to an electric vehicle can be daunting. However, our EV experts at Pentagon make the process hassle-free and convenient. So, you can choose the best EV finance for your new car.

We offer a wide range of funding options, including PCP, HP and PCH. Plus, our SAF-approved specialists guide you through each option to get the best deal for your budget. 

Our panel of accredited lenders offer:

Fixed rates – Your monthly payments and interest rate are fixed for the duration of your agreement. So you always know what you’re paying.

Low or no deposit – Secure your dream car with a low deposit of £99. In addition, some lenders don’t require a deposit at all. 

Easy application – Just a few details gets the ball rolling on your new EV purchase.