For more information about HP, visit our Hire Purchase Funding Explained guide. If you're a high mileage driver or would like to keep your car for a longer period of time, Hire Purchase (HP) can work out more effective than say a PCP deal. Should your circumstances change you are able to settle the agreement either partially or in full, and your finance company will be happy to provide a figure for this at any time. Once all the payments due under the agreement have been made the title passes to you and you are free to keep or dispose of the vehicle as you see fit. The monthly payments are determined by the amount of deposit initially paid, the period of the contract and the overall price of the vehicle.Ī typical hire purchase option will consist of paying a low deposit amount (maybe 10% of the vehicle price), have no mileage restrictions and entitle you the customer to eventual ownership of the vehicle.Įssentially, the Hire Purchase funding option is best suited to those customers who want simplicity. Hire Purchase is perhaps the most traditional of funding methods. Renew - Part-exchange your car, and if there is any remaining equity after the final payment is taken care of, this is yours to use as deposit or take as cash-backįind out more about how PCP works with our useful PCP finance guide. If car prices fall substantially and you find you have negative equity you hand the car back with nothing to pay) Return - Return the car with nothing more to pay, subject to mileage and condition. Retain - Buy the car by paying the optional final payment You have total control in deciding which of these choices suits you best. Your car's Guaranteed Future Value (optional final payment) is calculated (based on a pre-agreed annual mileage and your preferred change cycle) and is deferred as a final payment. It combines fixed monthly payments with exceptional flexibility at the end of the agreement. Personal Contract Purchase is a highly attractive and very popular way to own a new, nearly new or used car. Personal Contract Purchase How does PCP work:
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