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Balloon Payment Finance

If you’re coming to the end of your car finance agreement and have a final lump sum payment to make on your car, Red Potato can help.
We offer balloon payment finance to help make your outstanding balance more affordable.

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Balloon Finance

What is a balloon payment?

A balloon payment describes the final lump sum payment remaining on a car lease purchase or PCP (Personal Contract Purchase) agreement. This amount must be paid in order for you to have ownership of the vehicle. Depending on which type of finance option you have taken out, you may choose to swap or return your car to the dealership instead. Making the balloon payment, however, allows you to keep your current car and transfers ownership over to you.

People often choose to take out finance plans with balloon payment options as it lowers their monthly payments. This is because you’re not paying off the total amount of the vehicle each month (as you do with HP finance). Instead, you only pay the depreciation cost (with interest) over your finance period, with the balloon amount making up the remaining value of the car.

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Calculate what you could borrow

Our Car Finance Calculator can help you work out the cost of your monthly repayments based on your car budget.


Rate of interest (Fixed) Per Annum 16.24%. Representative 29.9% APR

Representative Example: Borrowing £5,500 over 48 months with a representative APR of 19.9%, the amount payable would be £162.34 a month, option to purchase fee £10.00, with a total cost of credit of £2,302.32 and a total amount payable of £7,802.32

Financing your balloon payment

Many people get to the end of their car finance term and don’t have the funds to make the final payment. If you find yourself in this situation then one option you have is to finance your balloon payment.

Balloon finance can provide you with a cost-effective option to paying the remaining balance on your car. Instead of paying off this amount at once, the cost is broken up into affordable monthly payments.


Why Red Potato?

Red Potato can help you to pay off the remaining balance on your car through a balloon finance agreement. As with our car finance options, we also specialise in balloon finance for those who have a bad credit history.

We can help you secure finance, even if you:

Our balloon finance options are available between 24-36 months.

How much will my balloon payment be?

The total amount of your balloon payment will have been calculated at the beginning of your car finance contract.

The balance of the balloon payment is based on the residual value or guaranteed future value. It’s an estimate of how much the car will be worth once you have made all your regular monthly payments. The cost takes into account trade guides and future predictions on the make and model of the car, mileage and its conditions when sold. Mileage limits might also be set to ensure that the car does not drop below the residual value.

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Premium plan representative example

Cash price £7,500.00
Deposit £0.00
Loan amount £7,500.00
Length of finance (months) 60
Interest rate applied to borrowing 10.66% (fixed)
Interest repayable £3,997.80
Monthly repayments £191.63
Option to purchase fee £10.00
Total amount repayable £11,507.80
Representative APR 19.9%

This website is operated by Premium Plan Limited. Red Potato is a trading name of Premium Plan Limited, which is registered in England with Company No 05977118. Registered office: Kempton House, Kempton Way, PO Box 9562, Grantham, Lincolnshire, NG31 0EA. Premium Plan Limited is authorised and regulated by the Financial Conduct Authority (FRN: 742272). The Red Potato name and logo are trademarks of Totemic Limited. Premium Plan Limited is a member of the Finance & Leasing Association (FLA).