Selling a Tesla on HP
Hire purchase works much like PCP at the point of sale. The difference is where you sit on the balance when you decide to sell.
The short answer
A Tesla on hire purchase can be sold once the lender’s settlement figure is paid. Because HP payments build toward outright ownership rather than a balloon, equity usually improves more steadily than on PCP, and negative equity is less common in the later stages.
- The selling mechanics are the same as PCP — settlement first, lender paid directly
- HP builds equity more evenly, so shortfalls are less common later on
- You do not own the car outright until the settlement is cleared
How HP differs from PCP
The distinction matters for your equity position, not for the process.
| Hire purchase | PCP | |
|---|---|---|
| What you are paying toward | Owning the car outright | Part of the value, with a balloon at the end |
| Monthly payment | Typically higher | Typically lower |
| Equity position | Builds more evenly through the term | Often weaker early, stronger near the balloon |
| At the end | The car is yours | Pay the balloon, return, or part-exchange |
| Selling early | Settlement figure, paid to the lender | Settlement figure, paid to the lender |
The process
Identical to PCP in practice.
- 01Request the settlement figureFrom your lender, stating the amount and how long it is valid.
- 02Get the car valuedYour valuation against the settlement figure gives your position.
- 03Settlement paid directlyTo the lender, closing the agreement.
- 04Balance to youAny positive equity is paid to your account.
- 05Shortfall cleared firstWhere the settlement exceeds the valuation, the difference is cleared before completion.
- 06Keep the confirmationEvidence that the agreement is closed.
A point about ownership
Commonly misunderstood, and worth being clear about.
On hire purchase you are not the legal owner of the car until the final payment is made, even though you are the registered keeper and it is your car in every practical sense.
That is why the settlement goes to the lender rather than to you, and why a sale cannot complete before the lender has been dealt with. It is not a complication introduced by the buyer — it is how the agreement works.
This is information about the process rather than financial advice. We are not financial advisers.
Keep reading
Everything else worth knowing before you sell.
The other common agreement type.
Settlement, equity and who gets paid when.
The whole process end to end.
The eight inputs behind every figure.
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