Finance Products

Why Finance Through a Dealership

What is Hire Purchase?

What is Personal Contract Purchase

 
HP Hire Purchase is a hiring agreement between the customer and finance company secured against the vehicle. The customer has the option to own the vehicle at the end of the agreement, subject to payment of the option to purchase fee.  
 
Hire Purchase is one of the most common types of finance, it is really simple – you hire the vehicle and make fixed monthly repayments until you have paid off all of the agreed finance. There are no surprises at the end of your agreement such as balloon payments or mileage restrictions. The entire car price is spread across your agreement term and once all monthly payments have been made the car becomes yours, making it one sensible option for borrowing.
 
PCP Personal Contract Purchase is in essence a purchase agreement. However a predicted minimum future value (balloon payment) is off set until the end of the agreement this is called Optional Final Payment (OFP). At the end of the PCP term, the customer has three options; 1) to keep the vehicle after paying the OFP, 2) hand back to finance the finance company or 3) part exchange for another vehicle. PCP is subject to agreed mileage at the end of the term where excess charges apply. Please ensure the mileage band meets your needs. 
 
LP Lease purchase is a form of conditional sale agreement, which means that the regular payments are similar to a lease/rental agreement but you will own the car at the end of the deal. The deferred sum will be determined by the age and mileage of the car at the end of the agreement. The difference between a lease purchase and a PCP agreement is that the deferred sum (referred to as a Guaranteed Minimum Future Value
 
CS Conditional Sale is very similar to the hire purchase, the key difference is that the customer will own the vehicle outright at the end of the agreement. There is no option to purchase fee to be paid. 
 
 PL A Personal Loan is normally a loan at a fixed cost for a fixed period of time to purchase any item the customer wants, which can be for many things including the purchase of a vehicle. This is not secured on the item purchased.