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Hire Purchase

Hire Purchase - Suitability explanation

Hire Purchase is normally the first port of call and the most popular method for people who are looking to acquire a new vehicle. If you’re looking to take full ownership of a business vehicle, then this is likely the perfect solution. Upon completion of the contract, the title will pass to the owner who is responsible for any depreciation as well as disposal at the end of the contract. 

It is also more affordable than simply buying the car outright, as you can agree to pay in instalments agreed between you and the lender. However, you cannot attempt to sell or dispose of the vehicle without the lender’s permission before finishing all the payments. Businesses will often follow this route when they intend to keep the vehicle for a long period of time or for specialist conversions. A mix between a loan and a lease, you agree with the dealer to pay a deposit of anywhere between 10% and 50% before using the monthly instalments to pay off the rest.

In essence, the lender buys the vehicle and gives you permission to use it while you make payments. Once all the payments have been made, the car belongs to you. 

Hire Purchase may not be suitable for you in certain circumstances. For example:

  • There is no option to return the vehicle, because by entering into a Hire Purchase deal you have already agreed to buy the car via monthly instalments.

Benefits of Hire Purchase 

  • Vehicle is registered in the company name
  • It is on the balance sheet
  • Fixed monthly payments not subject to VAT
  • No mileage restriction

Taking care of the vehicle  

  • You must ensure the vehicle is comprehensively insured at all times
  • It is a condition of the manufacturer’s warranty that the vehicle is serviced and maintained in accordance with the manufacturer’s requirements. They recommended that you use the services of a main franchised dealer

 

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Funders

 

Alternative Route and Alternative Route Leasing are trading names of Hanborough Enterprises Ltd who is authorised and regulated by the Financial Conduct Authority for consumer credit activities and insurance distribution. Our Firm Reference Number is 631448. You can check this on the FCA Register by visiting www.fca.org.uk or by contacting the FCA direct on 0300 500 8082. We are an independent vehicle finance broker and we operate with a panel of carefully selected funders. We may receive commission and/or other benefits from the finance provider if you enter in to an agreement with them. 

 

Alternative Route’s trading address is 11 North Street, Portslade, Brighton, East Sussex BN41 1DH.

 

Hanborough Enterprises Ltd is a company registered in England no 07216831. Registered office Jamesons House, Compton Way, Witney, Oxfordshire OX28 3AB. VAT Registration Number 110 3005 02. Data Protection Licence Z264186X. We are a broker not a lender


Finance is subject to status. Pictures are for illustration only and may not be the exact model. Calls are recorded for training and quality purposes. Errors and Omissions Excepted.


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