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| Finance Example | Hire Purchase |
|---|---|
| Duration of Agreement | 60 Months |
| Vehicle Price | £35,994.00 |
| Customer Deposit* | £8,998.50* Deposit is adjustable |
| Total Deposit | £8,998.50 |
| Balance to Finance | £26,995.50 |
| Total Charge For Credit | £7,730.500 |
| Total Amount Payable | £43,724.50 |
| 60 Monthly Payments | £578.60 |
| Option To Purchase Fee | £10 |
| Representative APR | 10.9% APR |
| Interest Rate (Fixed) | 5.72% |
| Cash Price Inc VAT | £35,994.00 |
Personal Contract Purchase (PCP) allows a more flexible repayment process. Unlike Hire Purchase (HP) the repayments cover only the depreciation of the vehicle resulting in lower monthly repayments. At the end of the repayment term the payee can decide to pay the remaining cost of the vehicle (ballon payment) and thus own the vehicle, return the vehicle or use it as equity towards the purchase of another vehicle.
Key features:
Hire Purchase (HP) allows for the full value of the vehicle to be broken down into monthly payments. Usually an initial deposit will be paid followed by equal monthly payments. Once the repayment term has been completed the vehicle is owned by the payee.
Key features:
Lease Purchase (LP) allows for the full value of the vehicle to be broken down into monthly payments. Usually an initial deposit will be paid followed by equal monthly payments over a set period of time. Once the repayment term has been completed the vehicle is owned by the business.
Key features:
(PCP) the business will make the repayments
Business Personal Contract Purchase allows a more flexible repayment process. Unlike Hire Purchase (HP) the repayments cover only the depreciation of the vehicle resulting in lower monthly repayments. At the end of the repayment term the business can decide to pay the remaining cost of the vehicle (ballon payment) and thus own the vehicle, return the vehicle or use it as equity towards the purchase of another vehicle.
Key features:
This is a popular option for businesses. Monthly payments are made over a set period of time allowing use of the van without ownership transferring to the business. The lease would come with the option to extend the lease or return the vehicle at the end of the lease term.
Key features: