PCP equity is the difference between your car's current market value and your settlement figure — the amount needed to pay off your finance today. If the car is worth more than the settlement figure, you're in positive equity. If it's worth less, you're in negative equity.

How do I calculate my PCP equity?

Get your car's current market value from a site like Auto Trader or We Buy Any Car, then request your settlement figure from your lender. Subtract the settlement figure from the market value — a positive result means positive equity, a negative result means negative equity.

What can I do with positive equity on a PCP?

Positive equity on a PCP can be used as a deposit on your next car. You can settle the finance, sell the car, and use the leftover amount toward your next vehicle — meaning you walk away with money rather than simply handing back the keys at the end of the contract.

Can I use Voluntary Termination if I'm in negative equity?

Yes. Voluntary Termination under Section 99 of the Consumer Credit Act is a right based on payments made, not on your equity position. Once you've paid 50% of the total amount payable, you can return the car regardless of whether you're in negative equity.

12 June 2026 · 5 min read

How to Check Your PCP Equity (And Why It Matters)

If you're driving on a PCP deal, you're probably paying monthly and not thinking too much about the numbers behind the scenes. But there's a figure that could be worth thousands to you — or cost you money if you ignore it. That figure is your equity position.

Here's what it means, how to calculate it, and what to do with it.

What is PCP equity?

Your equity position is simply the difference between what your car is currently worth and what it would cost you to settle your finance today.

Positive equity — your car is worth more than your settlement figure. If you sold or part-exchanged it, you'd pocket the difference.
Negative equity — your car is worth less than your settlement. If you ended the contract now, you'd owe money on top.

Most PCP drivers are in negative equity for the majority of their contract, particularly in the first two years. This is normal — depreciation front-loads the drop in value, while your settlement figure drops more slowly as you pay off interest.

How to calculate your PCP equity

You need two numbers:

1. Your settlement figure

This is the amount you'd need to pay your finance company today to own the car outright. It's not the same as your remaining monthly payments — it also accounts for any outstanding interest.

You can get this by calling your finance company or logging into your account. Many lenders (Black Horse, Santander Consumer Finance, Close Brothers, Moneybarn etc.) let you request a settlement quote online. It's usually valid for 28 days.

2. Your car's current market value

Two useful benchmarks:

We Buy Any Car (WBAC) — the guaranteed floor. They'll actually pay this.
Motorway, AutoTrader private sale — the realistic ceiling if you sold it yourself.

Your true equity sits somewhere between those two numbers depending on how you exit the contract.

The calculation:

Equity = Market value − Settlement figure

If the result is positive, you're in positive equity. If it's negative, you're underwater.

Why does this matter?

You're approaching the end of your contract

This is when equity becomes most important. If you're in positive equity, you have real negotiating power on your next car. You can use it as a deposit, potentially reducing your next monthly payment or putting yourself in a much stronger position.

If you're in negative equity at handback, you simply return the car — you don't owe the shortfall (that's the whole point of the GMFV guarantee). You may still face excess mileage or damage charges if you're over your allowance or beyond fair wear and tear, but the equity gap itself isn't your problem. You just won't walk away with anything.

You're thinking about ending early

If you want to exit your PCP before the end date, you'll need to settle the finance. If you're in negative equity, you'd need to cover the gap out of pocket, or roll it into new finance (which is how negative equity compounds over multiple contracts — avoid this if you can).

You're considering buying the car outright

If your settlement figure is significantly below your car's market value, buying it out and either keeping it or selling it privately can make financial sense. This is rare but does happen, particularly if you've kept the car in excellent condition and depreciation has been slower than the lender anticipated.

What about Voluntary Termination?

VT is a separate right under Section 99 of the Consumer Credit Act. Once you've paid 50% of the total amount payable, you can return the car with nothing more owed — regardless of equity (subject to fair wear and tear, and any clearly-disclosed excess mileage charges).

It's worth noting that VT isn't about equity at all. It's a right based purely on payments made, not on the car's value. You can be in positive equity and still use VT (though it would usually make more sense to sell), or in negative equity and use VT to exit without covering the equity shortfall.

How to track it without the spreadsheet

Manually calculating your equity, mileage pace, and settlement position every month gets tedious. EquityGo lets you enter your contract details once and tracks all of it automatically — equity position against your market value entries, mileage vs your annual allowance, VT progress, and end-of-term projections.

It's free during beta, no credit card needed.

The short version

Get your settlement figure from your lender
Check your car's value on WBAC and Motorway
Subtract settlement from market value
If positive — you have options worth knowing about
If negative — that's normal, but track it as you approach the end of your contract