Paying off your PCP agreement early is always a tough decision, but if you want to keep the car and settle your car finance earlier than planned, this will be necessary. The settlement figure covers any outstanding on finance as well as other charges that are added onto each monthly repayment amount for early termination with a lender. The final payment, also known as the
balloon payment
, is an additional cost that you will need to take into consideration when purchasing your car (to the overall settlement figure). The car's value often remains high throughout the contract term because monthly payments with PCP deals only cover the difference in prices between what is paid on the initial purchase and how much the car will be worth when you end your agreement.