Thousands of cars on personal contract plans are being handed back to finance companies because the owners face negative equity.

People who bought prestige models have suffered the most because a nosedive in second-hand prices has meant they owe more than the car is worth.

According to a car magazine the shortfall for drivers across the country has reached £272 million.

Customers who buy cars on PCPs are quoted a future final payment but are not required to buy the vehicle at the end of the agreement.