Hire Purchase offers a straightforward way of spreading the cost of your prestige car. It combines fixed monthly repayments and a fixed interest rate, making budgeting that bit easier.
At the start of the agreement, you decide the amount of deposit you would like to pay, typically 10% – 50% of the car’s price. The remaining balance, together with the interest is repaid over an agreed period, usually between 1-5 years.
The benefits of Hire Purchase car finance include:
- Flexible Deposit – allowing you to free up personal or business cash
- Control – you decide the deposit amount and the repayment term
- Set Monthly Payments – making budgeting simple
- Flexibility – no mileage restrictions
- Assets – you own the car at the end of the agreement
- Tax Benefits – tax allowances for business users
Before choosing Hire Purchase, you need to consider the following:
- Your monthly repayments may be higher than with other finance options
- You do not own the vehicle until the final payment has been made
- You are bound to the terms of the finance agreement, so you should consider your ability to repay, even if your circumstances change. You do not own the vehicle until the sums required by the agreement have been paid, including the option to purchase fee. If you fail to keep up repayments, this will impact your credit rating and may impact your ability to obtain credit in the future. In the event of default, the vehicle may be repossessed without a court order, unless you have paid a third of the total amount payable.
To speak to our team about Hire Purchase (HP) click here.