PCP Settlement Figure: How It's Calculated and How to Get the Exact Number

Your PCP settlement figure is the amount you'd need to pay your lender today to close your finance agreement and own the car outright. Most drivers know roughly what it means — but fewer understand how it's worked out, or why the number your lender quotes is often higher than expected.

How it's calculated

Your settlement figure is roughly:

Settlement ≈ remaining monthly payments + balloon payment − interest rebate

The rebate is the key variable. Lenders use an actuarial method that front-loads interest — you pay proportionally more interest in the early months, less toward the end. This means settling early in the contract saves you more than settling late. If you're 10 months into a 48-month deal your rebate will be relatively large; if you're 40 months in, it'll be much smaller.

The balloon payment (GMFV) is included in full, which is why settlement figures often feel high even late in the contract — a large chunk of the car's cost was always deferred to the end.

The 58 days of additional interest

When your lender provides a formal settlement quote, they're permitted to add up to 58 days of additional interest on top of the calculated balance. This is allowed under the Consumer Credit Act 2006 and covers the interest that accrues while you arrange payment.

Most lenders add 28–30 days as standard, matching the validity window of the quote. This is why a formal quote from your lender will always be slightly higher than any calculator estimate — a calculator works from today's balance, your lender adds the interest window on top.

How to request your settlement figure

Under the Consumer Credit Act 2006, your lender must provide a written settlement figure within 7 working days of your request, valid for at least 28 days. They cannot charge you for it.

Call your lender and ask for a settlement figure — most will give you an indicative number immediately over the phone. Follow up in writing (email or their portal) to get the formal quote. Keep the reference number; you'll need it when you come to pay.

If the quote expires before you settle, you'll need to request a new one.

Settlement vs Voluntary Termination

These are your two main early exit options:

| | Settlement | Voluntary Termination | |---|---|---| | What you pay | Settlement figure minus sale proceeds | Shortfall to 50% of total amount payable | | Keep the car? | Yes | No — handed back | | Best if... | You're in positive equity | You're in negative equity |

Settlement makes sense when your car is worth more than the settlement figure. VT makes sense when you're underwater and want a clean exit. Our VT guide covers that route in full.

How EquityGo helps

EquityGo estimates your settlement figure automatically from your contract details and updates it as you progress through the deal — so you have a current picture without calling your lender every time. It shows your equity position alongside it, so you can see at a glance whether settling makes financial sense.

Free during beta, no card required.