Hire Purchase is a method of buying a vehicle over a period of 12 to 60 months.
Key points of Hire Purchase
Contract lengths range from 12 to 60 months
Allows for accurate budgeting over the term of the Agreement
All of the VAT may be recoverable in the first year for vans, different for cars depending on use. Please ask your accountant to see if this applies to you
Vehicle is delivered to you
Appears on Balance Sheet
Things to consider about Hire Purchase
Road Fund Licence is supplied only for the first year
Interest is charged based on credit rating, vehicle value and contract length
You will be charged fees if you wish to exit the contract early
The initial payment and the final payment can be high