Hire Purchase With A Balloon ( Lease Purchase )

Hire Purchase with a balloon offers lower monthly payments than standard Hire Purchase. Instead, at the end of the agreement, you can make a final lump sum payment (or 'balloon') to purchase the car in full.

It's fixed rate finance, but with a lower fixed monthly outlay since you defer repayment of some of the borrowing. At the end of the agreement you have a number of options including car purchase, refinance, part-exchange or resale.

The deposit you pay is flexible - typically between 10% - 50% of the car’s full price. The deferred balloon element is calculated on the estimated future resale value of the car.

The difference, plus interest, is repaid in equal instalments over an agreed period (12-60 months), plus a final balloon payment.

Why consider Hire Purchase with balloon?

• Low deposit - doesn’t tie up cash reserves
• Lower fixed monthly payments - perfect for budgeting
• A better car - lower payments can help you choose a higher specification car
• Flexibility - does not compromise your other lines of credit
• Assets - you gain car ownership
• Tax benefits - Tax allowances for business users
• VAT free - no VAT on payment

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