Question about PCP finance

[bigbob77]

With a PCP finance agreement, they say that you can do a voluntary termination when you've repaid 50% of the agreement value.

What I don't understand is - what's the agreement value? Is it the total price of the deposit, monthly payments, balloon payment and fees? Or is it everything up to (but not including) the balloon payment?

If it includes the balloon payment... Then the earliest you can do a termination is basically the last month of the agreement... So what's the point?

[Sarnie]

Yep, it's 50% of the total you have agreed to pay.

People assume that this just means when you are 18 months into a 36 month agreement but it's not...........

[bigbob77]

Thanks

I think I found it confusing because I'm treating the PCP as a lease (due to dealer incentives, PCP works out cheaper monthly than any lease I could find).

So I never really counted the balloon payment as something I've agreed to pay - we will definitely hand the car back at the end.