I think I may exceed my mileage limit, what should I do?

If during your contract you expect to exceed or find that you have actually exceeded the pre-agreed mileage limit, consider asking your car dealer to restructure your contract. You can restructure your contract by changing from a PCP to a Hire Purchase (HP) agreement or you can return the car early. By returning the car early you can enter into a new, more suitable agreement which has a higher mileage limit or no mileage limit at all.

Can I cancel my PCP before I finish my monthly repayments?

With a PCP you can end your contract and give back the car and pay half the PCP price – this is called the ‘half rule’.

The half rule is part of the Consumer Credit Act 1995 and gives you the right to end a PCP agreement at any time. The half rule limits your liability (the amount you are responsible for) to half the PCP price of the car. The agreement from the finance company must show the figure for half the PCP price of the car.

If you have paid less than half of the PCP price of the car, you can give the car back, and you will only owe the difference between what you have paid, and half of the PCP price of the car. You don’t have to pay half the PCP price to the lender before you end the agreement under the half rule. However, you will have to pay the difference between the payments you have made to date and half the PCP price. You will be responsible for the cost of any repairs that are necessary.

If you have paid more than half of the PCP price of the car and have not missed any payments, you can end the agreement and hand back the car. You will be responsible for the cost of any repairs that are necessary. If you have paid more than half of the PCP price, you will not be entitled to any refund.

For examples of how the half rule works, take a look at our leaflet on ending a hire purchase agreement.

If you’re having trouble making repayments on your PCP you can review your options here.

Can my car be repossessed?

With a PCP, your car can be repossessed if the terms of the contract are broken, for example, by missing repayments. If you have paid less than one-third of the PCP price, the lender can take back your car without a court order.

If you have paid more than one-third of the PCP price, the lender will need a court order to take back the car. In addition, the car cannot be repossessed from your private property. For example, if the car is parked in your private driveway, it can’t be taken away, regardless of how much money you’ve paid back.

If your car is repossessed, the lender will generally sell the car and the money goes towards the outstanding debt. But you will still be liable for the difference between what is owed and what the car is sold for. For example, if the car is sold for €5,000 and you owe €8,000, you will still have to pay back the €3,000.