Instead of trading your current PCP (Personal Contract Purchase) vehicle into the dealer you had it from, you can trade it into a different dealership. They will then settle the finance agreement for you, meaning that if you find a better deal elsewhere, you won’t be stuck having to use the same dealer.

What are my options at the end of a PCP deal?

When you come to the end of your PCP car finance deal, you are faced with three options:

  • Pay the pre-agreed balloon payment (GMFV) and keep the car
  • Hand the car back to your dealer and walk away
  • Use any equity you may have to finance a new car

What a lot of people don’t know is that if you take the third option you can actually use that equity with another dealer – instead of being stuck with the same dealer you have financed the current car with.

If you find a better deal elsewhere, your new dealer will simply pay the balloon payment for you and allow you to carry forward any equity to put towards a new PCP car finance deal with them.

How to get the most out of my PCP trade-in?

If you’re keen to get the most out of your PCP trade-in, regardless of which dealer you opt for – there are ways you can increase your equity on the financed car. So that when the time comes to hand it back it is actually worth more than the GMFV, and leaves you with some equity to put towards a new car.

Reduce your mileage

The GMFV will have been calculated based on the mileage you expect to rack up over the duration of your PCP deal. So the less miles you do, the more the car will be worth, and the bigger the difference between the cars GMFV and its actual value – leaving you with more equity.

Have any damage rectified

Serious damage to your financed car will need to be rectified otherwise you face additional charges from your provider come the end of your deal. These are often to cover the cost of repairs and could therefore end up being quite expensive.

Some wear and tear is expected though, and even factored into the GMFV when originally calculated. It is worth trying to stay on top of any signs of wear and tear however, as the better the condition of the car, the higher its value will likely be – and the more equity you will have.

In some cases, if the car has suffered a lot of wear and tear, it may actually be worth less than the GMFV. This won’t affect you if you are handing it back to the same dealer you had it from, but if you plan to switch dealers, they will take the wear into account – and leave you with less, or even negative equity to carry over to your new deal.

For more information on accepted wear and tear when you hand your financed car in – check out our BVRLA Fair Wear And Tear guide.

Service history

Keeping an up to date service history is one simple way of possibly increasing the value of your car. Dealers will want to know exactly how well maintained it has been kept during your contract and any gaps in the history that don’t add up will probe further questions and cause further decreases in value.

Need a new car fast? Moneyshake saves you time and money by comparing the best deals.

Can I still trade-in my PCP car to another dealer with negative equity?

Negative equity is when the value of your car is lower than the amount you currently owe on it. So if by the time your contract ends your car is worth £7,000, but the balloon payment is £8,000 – then you will have negative equity worth £1,000.

This is not a problem if you choose to hand the car back to the original dealer. They take on the risk when they set the GMFV at the start of your contract – and you won’t have to pay for the difference.

If you want to trade your car into another dealer however, this may pose some problems. The new dealer did not agree to such risks and will expect the difference to be covered by you, either as a lump sum or split over the duration of your new contract.

This is okay if you have the cash, but adding it to your new monthly payments will only increase the likelihood of negative equity occurring at the end of your new contract.

Can I trade my PCP car in to another dealer early?

You can actually trade your PCP car in to another dealer early – but you will have to pay a settlement fee to your original dealer. This is to cover the outstanding finance you still owe.

If the value of your car is higher than the settlement figure, a new dealer may offer to pay the fee for you – and allow you to carry forward that equity to put towards a new PCP deal.

However, PCP contracts often include a minimum commitment phase, in which you will have to honour the agreement. You will not be able to trade the car in to any dealer while still in this minimum commitment phase.

Pros and cons of trading my PCP car into a different dealer?


  • The new dealer may value the car higher, and give you more equity towards a new deal
  • There may be a particular make/model that you want on offer from a new dealer
  • You can get a variety of quotes and opt for the dealer which values your car the highest


  • There is no GMFV so refinancing with a new dealer may leave you with negative equity
  • If your car is valued lower than the settlement fee – you may struggle to find a dealer willing to pay
  • Communicating with two dealers as opposed to one